USA stocks open slightly higher

Judith Bessette
Agosto 13, 2017

USA indexes were trading at session lows on Thursday afternoon, with the Dow and the Nasdaq posting triple-digit point declines, as investors fretted over escalating tensions between the United States and North Korea.

Investors await the headline U.S.consumer inflation data for July for more clues about future Fed decisions.

Earnings results also weighed on stocks. "The market is interpreting it as lowering the odds of the Fed raising rates in December", said Keith Lerner, chief market strategist at SunTrust Advisory Services in Atlanta. The stock has more than doubled over the past 12 months, gaining more than 160%.

"The escalation of the geopolitical situation between the US and North Korea is beginning to rattle investors' nerves as was witnessed in the VIX index yesterday", said Peter Cardillo, chief market economist at First Standard Financial.

Trump suggested in remarks on Thursday that his comments threatening North Korea with "fire and fury" may not have been tough enough. Bond and gold prices, traditional havens for nervous investors, were little changed, and the VIX, a measure of how much volatility investors expect in stocks, slid 6.7 percent following a 44.4 percent jump the day before.

"There's not a great incentive to buy big", said Lerner of SunTrust Advisory. AES Corp. shed 26 cents, or 2.3%, to $11.12.

The Dow Jones Industrial Average fell 163 points, or 0.74%, to 21,886, the S&P 500 lost 31 points, or 1.23%, to 2,443 and the Nasdaq Composite dropped 117 points, or 1.84%, to 6,236. Netflix lost 1.5 percent.

Emerging market stocks lost 1.27 percent.

In economic news, German consumer inflation grew an annual 1.7 percent in July, slightly faster than the 1.6 percent increase registered in June, final data from Destatis showed.

In overseas trading, stock markets across the Asia-Pacific region saw continued weakness during trading on Friday.

Many world stock markets have hit record or multi-year highs in recent weeks, leaving them vulnerable to a selloff, and the tensions over North Korea proved to be the trigger.

'Sanctions not solution to Venezuela crisis'
Taking questions from reporters at his golf course in Bedminster, New Jersey, Trump said , "We have many options for Venezuela ". Venezuela's defense minister called Trump's talk of a military intervention an act of "craziness" and "supreme extremism".

The yen tends to benefit during times of geopolitical or financial stress as Japan is the world's biggest creditor nation and there is an assumption that Japanese investors there will repatriate funds should a crisis materialize.

CURRENCIES: The euro slipped 0.1 percent to $1.1176 while the dollar was steady at 109.20 yen.

THE QUOTE: "Today's inflation data put the Fed on pause and really diminishes the fact that there's still some noise going around with the North Korea-U.S. situation", said Phil Blancato, CEO of Ladenburg Thalmann Asset Management.

"If the data continues to come in on the softer side, the market might start to price the Fed staying on hold this year", said Sireen Harajli, FX strategist at Mizuho in NY.

The Russian dollar-traded index RTS was down 1.49 percent, and ruble-traded MICEX fell 1.29 percent by midday.

Sterling was last trading at $1.3007, up 0.25 percent on the day.

Nvidia Corp.(NVDA) shares fell 5.5%, even after the chip maker posted upbeat earnings late Thursday.

The selling in the USA extended to global markets Friday. Perrigo rose $2.17, or 2.8%, to $79.01.

Bond prices fell. The yield on the 10-year Treasury note rose to 2.22% from 2.20% late Thursday.

After touching a more than two-month high at $1,291.86, spot gold last added 0.2 percent to $1,288.81 an ounce. Wholesale price inflation eased to an eight-month low of 2.2 percent in July from 2.5 percent in June.

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