Monday, 21 August, 2017

Global stocks sell off stops at Wall Street

Asian shares and US stock futures slipped while US Treasuries gold and the safe-haven yen rose in early Asian trading on Wednesday after tensions on the Korean peninsula escalated North Korea nerves push stocks to worst week since November
Nellie Chapman | 13 August, 2017, 17:40

The Nasdaq Composite Index climbed 39.68 points, or 0.6%, to close at 6,256.56.

During 2017 to date, the usa equity market has been driven by a wide range of positive factors, including sustained US economic growth momentum, planned corporate tax cuts by the Trump administration, moderate inflation pressures and positive US corporate earnings growth prospects, so geopolitical risks from North Korea are not the only factor impacting on the usa equity market outlook. "And while risks remain elevated from a geopolitical perspective, valuations are not necessarily excessive, though full". These have ranged from an investigation into Russia's possible interference in the 2016 USA presidential election, to concerns about China's risky debt levels, to stubbornly low inflation in the U.S.

Read:Few investors are excited about stocks. "If the USA should target North Korea, it would have to deal with North Korea's nuclear weapons, and there's also the possibility for Russian Federation and China to intervene", Yang said. The major indexes were coming off their biggest single-day decline since May 17.

Australian shares were down 1.3 percent, set for a weekly loss of 0.6 percent.

Japanese markets were closed for a holiday but the tense mood dragged Asian shares lower and an MSCI index of stocks across the globe was on track to post its largest weekly drop since the week before Donald Trump won the USA presidential election in November.

North Korea and the United States have traded bellicose rhetoric after the United Nations Security Council further tightened sanctions on North Korea for its two tests of intercontinental ballistic missiles last month.

The $1,279 area is a key technical level, representing a downtrend that has been in force since mid-2016 when gold surged to a two-year peak of $1,374.91.

Benchmark 10-year notes were last up 12/32 in price to yield 2.201 percent, from 2.242 percent late on Wednesday.

"If you look at the gold price after the CPI (inflation) data, it tells you that the Fed is not going to be in any rush to increase the interest rate this year", said Naeem Aslam, chief market analyst at Think Markets.

Outside the political arena, declines in a pair of technology stocks added to the cautious tone on the day.

Nvidia Corp.(NVDA) shares fell 5.3%, even after the chip maker posted upbeat earnings late Thursday.

BIG GAINERS: Health care stocks were among the big gainers.

Technology companies led USA stocks slightly higher in afternoon trading Friday, recouping some of the losses from the day before. Hong Kong's Hang Seng Index plunged by 2 percent, while South Korea's Kospi Index slumped by 1.7 percent.

An editorial in China's state-run Global Times (http://www.globaltimes.cn/content/1060791.shtml), published late Thursday local time, added to the pressure on Asian markets. USA military bases in Japan. Seagate shares rose 69 cents to $32.24.

Shares of U.S. department stores Kohl's and Macy's were weak after their results.

Nervous traders have scrambled to take refuge in traditional safe havens such as gold, silver, bonds, Japanese yen and Swiss franc, dampening interest in risk assets such as equities and industrial commodities.