Donald Trump's North Korea posturing hits global markets

Donald Trump's North Korea posturing hits global markets

Politics lifted US defence stocks. The single currency fell to a more than one-week low of $1.1687 yesterday before rebounding to a high of $1.1769 in Asian trading today.

Defensive assets drew support from fresh tensions surrounding North Korea after reports that the Pyongyang regime had developed a miniaturised nuclear warhead which could be deployed on a long-range missile.

"That may have weighed a little bit" on markets, said Phil Guarco, global investment specialist J.P. Morgan Private Bank.

The Standard & Poor's 500 index slipped 0.90 points, or 0.04 percent, to 2,474.02.

The Dow Jones Industrial Average closed lower at 22,048.70. The S&P 500 is up 9 percent, while the Dow is up 10.6 percent.

The Nasdaq composite lost 13.31 points, or 0.2 percent, to 6,370.46.

According to analyst Simona Gambarini, the price of gold "tends to rise in anticipation of a conflict but often falls when tensions turn into a full-blown war". "Circuit breakers in stock markets aren't being triggered yet". The Japanese yen was the best-performing currency despite the island nation's proximity to North Korea, which is typically a negative development for domestic equities.

Aug 10 (Reuters) - U.S. indexes were set to open lower for the third straight day on Thursday as North Korea's threat to land a missile just short of the U.S. territory of Guam added fuel to simmering tensions with the United States.

Outside of geopolitical concerns, disappointing company earnings and outlooks put traders in a selling mood. The stock fell $3.30 to $30.09.

Macy's shares closed down 10.2 percent and Kohl's fell nearly 6 percent as the companies continued to report a drop in quarterly same-store sales, stoking concerns that their turnarounds may still be a long way off. The stock fell 85 cents to $12.76.

MEDIA MALAISE: Shares in several other big media companies were down.

Michael Kors climbed 21.5 percent after the luxury handbag and apparel designer and retailer's latest quarterly results beat analysts' forecasts as sales improved. The stock was the biggest decliner in the S&P 500, losing $155 to $1,893.99.

Emerging market stocks lost 1.20 percent.

USA crude shed 20 cents to $48.97 a barrel, while Brent crude fell 26 cents to $51.88 a barrel. Brent crude, used to price worldwide oils, gained 40 cents to $52.54 in London. The euro held steady at $1.1752. Natural gas gained 2 cents to $2.82 per 1,000 cubic feet.

Declining issues outnumbered advancing ones on the NYSE by a 2.29-to-1 ratio; on Nasdaq, a 2.47-to-1 ratio favoured decliners. Copper rose 4 cents to $2.94 a pound. The euro rose to $1.1753 from $1.1752. "The market is interpreting it as lowering the odds of the Fed raising rates in December", said Keith Lerner, chief market strategist at SunTrust Advisory Services in Atlanta.

MARKETS OVERSEAS: In Europe, Germany's DAX fell 1.1 percent, while France's CAC 40 slid 1.4 percent. Regeneron Pharmaceuticals led the pack, adding $6.99, or 1.5 percent, to $476.67.

US stocks recovered temporarily late on Wednesday as investors appeared to brush off the geopolitical concerns following encouraging comments from Secretary of State Rex Tillerson.