Futures lower as North Korea tensions linger

Gladys Abbott
August 12, 2017

U.S. President Donald Trump on Thursday warned Pyongyang again, saying his previous promise to unleash "fire and fury" may not have been strong enough after North Korea responded with a threat to fire missiles over Japan to land near the U.S. Pacific territory of Guam.

The Dow Jones Industrial Average fell 33.08 points, or 0.15 percent, to 22,085.34, the S&P 500 lost 5.99 points, or 0.24 percent, to 2,474.92 and the Nasdaq Composite dropped 13.31 points, or 0.21 percent, to 6,370.46.

In morning trade, the FTSE 100 fell 87.67 points, or 1.2%, to 7,302.27, having dropped 1.4% on Thursday.

Nervous investors drove shares lower earlier in the week, after President Trump declared Tuesday that the USA would react with "fire and fury" to further nuclear provocations from North Korea.

London's FTSE 100 was almost 1% down during morning trading with share indices in Germany, France and Italy also in the red.

North Korea has since threatened to launch missiles at the USA territory of Guam, and the country previously threatened "all-out war, wiping out all the strongholds of enemies, including the US mainland".

Franco Nevada Corp rose 3.9 percent to C$95.65, while Barrick Gold Corp was up 1.9 percent at C$21.26.

Vietnam shares fell 2.3 per cent, their most in nine months, dragged down by financials and consumer staples.

Energy stocks retreated 0.5 percent, despite higher oil prices.

Nordstrom shares were up 1.63 percent at $45.60 following the apparel retailer's better-than-expected quarterly same-store sales.

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US trading volume has been low with summer setting in and Congress expected to be in recess until September 5.

Markets have tended to shrug off North Korea's sabre-rattling in the past, dismissing it as bluster, but the latest tensions have added to jitters.

Avis Budget Group slumped 9.9 percent after the vehicle rental company cut its guidance following a weak second quarter.

Other markets in Europe also fell, with Germany's Dax index down 0.6% and France's Cac 40 dropping 1.25%.

US crude rose 0.41 percent to $48.79 per barrel and Brent was last at $52.01, up 0.21 percent.

The Japanese yen last strengthened 0.03 per cent versus the greenback at 109.22 per dollar.

The September crude contract was up 20 cents to US$49.76 per barrel and the September natural gas contract was up seven cents to US$2.95 per mmBTU.

The Nasdaq Composite, meanwhile, was facing its worst week since the one ended December 2, which logged a loss of just over 2%.

Benchmark US 10-year notes last rose 6/32 in price to yield 2.1905 per cent, from 2.211 per cent late on Thursday.

Ongoing global glut concerns lingered in oil markets despite a bigger-than-expected draw in US crude inventories, leaving prices volatile.

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