U.S. stocks fall on North Korea worries

Andrew Cummings
August 12, 2017

Safe-haven perceived gold rose to a more than two-month high of $1291.99 an ounce during today's trading. Japan was closed on a public holiday. Canada Goose Holdings Inc fell 3.6 percent to C$23.16, but the luxury down-coat maker initially jumped more than 7 percent after reporting smaller-than-expected quarterly loss.

American and South Korean officials said they would move forward with large-scale military exercises later this month, which North Korea claims are a rehearsal for war.

The Swiss franc, another safe-haven, failed to maintain momentum from earlier days, losing ground relative to the euro and was last broadly flat versus the dollar after dollar/franc fell to a fresh two-week low 0.9582 earlier in the day.

USA stocks closed lower on Tuesday after Trump's vow to respond aggressively to any North Korean threats triggered a late afternoon selling spree.

ANALYST'S TAKE: The U.S.jobs figure "was through the roof" and the NFIB survey "painted a much better picture for the U.S. economy than most believed", Stephen Innes of OANDA said in a report.

Dollar/loonie was last down 0.3% and below the 1.27 mark after rising to a one-month high of 1.2752 earlier in the day.


Rising tensions between North Korea and the United States were once again the theme of the day with only the release of much-awaited inflation figures out of the USA managing to divert attention away from developments on that front.

Meanwhile, initial claims for state unemployment benefits increased 3,000 to a seasonally adjusted 244,000 for the week ended August 5, the Labor Department said on Thursday.

Markets began to tumble Tuesday after President Trump promised North Korea will face "fire and fury like the world has never seen" if the country continues to threaten the US.

The benchmark U.S. yield yesterday was just above 2.2 per cent, at its lowest level since late June, as investors bought up Treasuries, a classic safe harbor.

On the currency markets, sterling rose 0.2% to flit around the 1.30 USA dollar mark, with the greenback falling in response to the latest U.S. inflation data. By 2.50pm, it was trading down 0.1%.

The dollar was steady against a basket of six major currencies at 93.385 after falling 0.2 percent on Thursday, with disappointing US inflation and jobs data adding to the greenback's woes.


The broad-based S&P 500 fell less than 0.1 per cent at end at 2,474.02, while the tech-rich Nasdaq Composite Index dropped 0.3 per cent to 6,352.33.

Markets are now awaiting US consumer price data for July, due later in the session.

European bourses also looked set to open lower across the board, with Eurostoxx 50 futures already down 0.7 percent in early trade.

Global benchmark Brent also fell 0.9 per cent to $51.44, after Thursday's 1.5 per cent drop.

Ralph Lauren gained $10.38, or 13.3 percent, to $88.53, while peer-to-peer loan company LendingClub added 99 cents, or 18.1 percent, to $6.45.

In commodities trading, United States crude oil was wallowing around $49 to the barrel amid speculation that a predicted gain in American output will offset OPEC-led efforts to trim a global glut.


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