North Korea Threat Casts an Ominous Cloud -- Here's Where Wall Street Stands

A street sign for Wall Street is seen outside the New York Stock Exchange in Manhattan New York City

S&P, Dow hit record highs as Apple climbs

Russian stock indexes fell on Friday as global risk aversion, sparked by geopolitical tensions between the United States and North Korea, boosted demand for safe haven assets, such as gold. Britain's FTSE 100 added 0.1 percent.

Stock markets around the world continued their downward slide after US President Donald Trump made another verbal attack on North Korea.

Analysts said media and entertainment stocks also seemed to get caught up in the broader market drop, but emphasized it was often hard to isolate reasons behind specific stocks' movements.

Federal funds futures suggested the chance of rate hike in December fell to 40 percent from 42 percent shortly before the release of the data.

The tech-heavy Nasdaq Composite underperformed its peers, falling 135.46 points, or 2.1%, to 6216.87. Sony Corp. shares in Tokyo dropped 1.6 percent.

The fall comes against a background of increasing tension between North Korea and the US, with the former making a threat to land a missile just short of the US Pacific territory of Guam. Secretary of State Rex Tillerson later insisted the USA isn't signalling it's about to mete out a military response despite threats from North Korea suggesting it could attack Guam, a US island territory in the Pacific.

Market analysts expect that the pullback in stocks due to the increasingly aggressive tone in exchanges between Washington and Pyongyang will continue, although investors hope that the selling will not escalate to a correction - a decline of 10 percent or more. The Russell 2000 index of smaller-company stocks ticked up 0.2% to 1,416.

"Of course it's all come at a time when share markets are due for a correction, so North Korea has provided a ideal trigger", he added. New Year gloom surrounding China and its currency volatility resulted in a 10.5 percent decline in 2016. And certainly, many believe confidence is too high: On a cyclically adjusted price-earnings basis, US equity valuations have already exceeded the highs seen before the 1929 crash. The stock fell $169 to $1,879.98.

Shares were down 15.5p to 1,826p. Similarly certain havens, such as US government bonds, have risen.

The benchmark USA yield on Thursday was just above 2.2 percent, at its lowest level since late June, as investors bought up Treasuries, a classic safe harbor.

Elsewhere in commodities, the September crude contract was up 39 cents to US$49.56 per barrel, September natural gas advanced six cents at US$2.88 per mmBTU and the September copper contract declined two cents at US$2.93 a pound. Silver gained 47 cents, or 2.9 percent, to $16.86 an ounce. Brent crude, used to price worldwide oils, declined 29 cents to $51.61 per barrel in London. Wholesale gasoline was little changed at $1.62 a gallon, heating oil rose 2 cents to $1.65 a gallon and natural gas rose 6 cents to $2.88 per 1,000 cubic feet.

The dollar fell to 109.85 yen from 110.48 yen late Tuesday.

Sterling was also down 0.1% versus the euro at 1.104.

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