Wall St rises on inflation data but on track for weekly losses

Paterniano Del Favero
Agosto 13, 2017

Investor sentiment turned negative after North Korea said it was completing plans to fire four intermediate-range missiles over Japan to land near the US Pacific territory of Guam in an unusually detailed threat.

Aug 11 (Reuters) - U.S. stocks were modestly higher in late morning trading on Friday as investors cautiously dipped back into riskier assets, after a three-day losing streak on concerns over escalating tensions between the United States and North Korea. With the sell-off on the day, the Nasdaq and the S&P 500 fell to their lowest closing levels in a month.

The Dow Jones Industrial Average closed down 204.69 points, or 0.93 percent, at 21,844.01, the S&P 500 lost 35.81 points, or 1.45 percent, to end the session at 2,438.21 and the Nasdaq Composite fell 135.46 points, or 2.13 percent, to 6,216.87.

The primary indicator of the week, consumer prices have slightly advanced in the month of July in the United States, but less than expected, according to figures released Friday by the ministry of Labour. The Russell 2000 index gave up 24.40 points, or 1.7 percent, to 1,372.54.

Benchmark 10-year notes last rose 5/32 in price to yield 2.2255 per cent, from 2.242 per cent late on Wednesday.

The weaker-than-expected consumer price data in July, which pointed to benign inflation, could cause the Federal Reserve to hold off from raising rates again this year.

The headlines about North Korea served as a spark to jolt investors out of complacency on the heels of an extended period of calm in the market, said McClellan who shared the following chart in a report.

Stocks are under pressure on Wednesday at the mid-session as the tension between the United States and North Korea continues to heat up.

"Military solutions are now fully in place, locked and loaded, should North Korea act unwisely".

In an apparent response to Trump's tweet, a statement issued by North Korea's official KCNA news agency claimed the president is "driving the situation on the Korean peninsula to the brink of a nuclear war". "Hopefully Kim Jong Un will find another path!" Britain's FTSE 100 sank 1.3 percent. Hong Kong's Hang Seng was off 0.3 percent. Autodesk (ADSK) and Red Hat (RHT) posted notable gains.

Weakness in the Materials and Telecom Services sectors weighed on the market. Netflix lost 1.5 per cent.

The Dow slid as declines in Apple and Goldman Sachs, down 2.3% and 1.7% respectively, outweighed gains in McDonald's and Coca-Cola, up 1.4% and 0.5% respectively.

The latest sell-off was the most severe yet, amounting to the biggest single-day drop for the stock market in almost three months.

The major European markets are also extending a recent move to the downside. It was up $15.70, or 1.2 percent, to $1,278.30 an ounce. Banks and department store shares also were among the big decliners.

The yield on the 10-year Treasury bond fell to 2.2% and is approaching its lowest level of the year.

Michael Kors Holdings Ltd. climbed 21.5 percent after the luxury handbag and apparel designer and retailer's latest quarterly results beat analysts' forecasts as sales improved.

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