US stocks slide amid heightened US-North Korea tensions

Judith Bessette
Agosto 13, 2017

US President Donald Trump's brinkmanship in the escalating tensions with North Korea has taken a heavy toll on global markets, wiping $1 trillion off the value of shares worldwide.

"Trump's comments about North Korea have created nervousness and the fear is if the President really means what he said: "fire and fury", said Naeem Aslam, chief market analyst at Think Markets in London.

The so-called fear gauge - the CBOE Volatility Index (VIX), the most widely followed barometer of expected United States stock market volatility, hit its highest since November 8, when Mr Trump was elected president.

Gold prices rose to their highest level in two months Thursday, as an escalating war of words between the USA and North Korea drove investors into haven investments.

South Korean shares, which have been among the strongest performers in the world so far this year, fell 1 percent, while the won lost around 0.6 percent to 1,134.70 to the dollar.

North Korea raised the stakes further on Thursday with a detailed plan to send a salvo of missiles towards the US Pacific territory of Guam.

Inflation has risen 1.7 percent over the past 12 months, suggesting that inflation pressures remain well under control. Like gold silver has also seen a rise, reaching a high of $17.24, before finishing 1.1% up at $17.08.

Equities fall on rising tension between US & North Korea
After a dip of as much as 0.52 per cent earlier in the day, Wall Street's three major indexes bounced off intraday lows. In overseas trading, stock markets across the Asia-Pacific region saw continued weakness during trading on Friday.

Rising costs for housing, medical care and food helped push the Consumer Price Index (CPI) up 0.1 percent in July, seasonally adjusted, after no change in June and a 0.1 decrease in May, the US Labor Department said.

The Dow Jones Industrial Average fell 94.55 points, or 0.43 per cent, to 21,954.15, the S&P 500 lost 19.51 points, or 0.79 per cent, to 2,454.51 and the Nasdaq Composite dropped 76.39 points, or 1.2 per cent, to 6,275.94.

The dollar index, which tracks the greenback against a basket of six major rivals, was almost flat on the day at 93.646, remaining above last week's 15-month low of 92.548. The Russell 2000 index of smaller-company stocks gave up 13.20 points, or 0.9 percent, to 1,396.95.

The broader Topix shed 0.65 point to 1,617.25, while the JPX-Nikkei Index 400 shed 8.16 points, or 0.1 percent, to end at 14,367.56.

Bond prices rose. The yield on the 10-year Treasury note slipped to 2.19 percent from 2.20 percent late Thursday. Major indexes in Asia closed lower.

Macy's M.N shares closed down 10.2 per cent and Kohl's KSS.N fell nearly 6 per cent as the companies continued to report a drop in quarterly same-store sales, stoking concerns that their turnarounds may still be a long way off.

In currencies, the yen strengthened 0.64 per cent versus the greenback at 109.37 per dollar. Brent crude, used to price global oils, declined 40 cents to $51.50 per barrel in London. Australia's S&P/ASX 200 dropped 1.2 percent. The strength in the sector came as gold for December delivery jumped USD10.80 to USD1,290.10 an ounce. The euro held steady at $1.1752.

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