Dow plummets 205pts as Trump inflames Korea tension

13 August, 2017, 14:07 | Author: Terri Saunders

The S&P 500 sank 1.7% from Tuesday to Thursday, the Dow fell 1.1%, and the Nasdaq dropped 2.4%.

"We're not very oversold yet so the market still has more downside left to it", said Robert Pavlik, chief market strategist at Boston Private Wealth in NY.

Read:Few investors are excited about stocks.

But for the week the S&P 500 lost 1.3 percent, its worst weekly showing since March.

USA stocks opened lower on Wednesday as investors flocked to safe-haven assets amid escalating tensions between North Korea and the United States.

The latest rhetorical escalation comes after North Korean state media reported that the country's military leaders were working on a proposal to launch four intermediate-range missiles into the sea less than 25 miles off Guam's coast.

The S&P 500 is down 38.62 points, or 1.6 percent.

Apart from geopolitical worries, some technical analysts like Tom McClellan, editor of the McClellan Market Report, blamed seasonality for this week's retreat given August's record as a weak month for stocks.

Investors are increasingly nervous: The VIX volatility index, a closely-watched "fear gauge", is up 70% since Tuesday. Wholesale prices advanced 2.2 percent on a yearly basis in July, slower than the 2.5 percent increase in June.

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Life on the streets of the North Korean capital, Pyongyang, also remained calm. She said, "I don't see a military solution and I don't think it's called for".


"If the market truly believed the North Korea reaction was imminent, I think it would be down a lot more than it is", said Alan Skrainka, chief investment officer at Cornerstone Wealth Management.

Canada's main stock index turned slightly higher in early trade on Wednesday, as gains for gold miners and energy companies with higher commodity prices offset falls among financials.

Singapore banks led the decline, with DBS Group shedding 2.2 per cent or 46 cents to $20.80; OCBC Bank fell 12 cents or 1.1 per cent to $11.20; United Overseas Bank Group lost 1.3 per cent or 33 cents to $24.20.

Most large-cap stocks fell across the board. Brent crude futures lost 0.8 percent to $51.5 per barrel on persistent oversupply worries despite a bigger-than-expected drawdown in USA crude inventories.

USA stock indexes opened higher for the first time in four days on Friday after tepid data pointed to benign inflation that could make the Federal Reserve cautious about raising rates again this year, even as concerns lingered over rising tensions between the United States and North Korea. Titled "Reckless game over the Korean Peninsula runs risk of real war", the editorial suggested China will stay neutral if North Korea strikes first, but will intervene if the U.S.is the first mover.

If the North Korean regime "does anything" to the USA or a United States ally "things will happen to them like they never thought possible", he told reporters on Thursday, according to Bloomberg. "When earnings are not beating expectations there's a sell off in the companies, and we're just not seeing that money reinvested because of the geopolitical risks".

Retailers slid after department stores Macy's and Kohl's both said same-store sales continued to decline in the second quarter.

Gold prices posted strong weekly gains (http://www.marketwatch.com/story/gold-heads-for-strong-weekly-gain-as-stock-market-exit-persists-2017-08-11) thanks to safe-haven demand.

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