Shares hit by US-North Korea tensions

Reuters

Stocks around the world fell sharply on Thursday and investors moved into the yen, gold and other safe-haven assets amid more aggressive talk between the United States and North Korea. The Russell 2000 index of smaller-company stocks slipped less than 1 point to 1,371. The Hang Seng index ended down 1.1% at 27444.00 points. The S&P 500 added 3.11 points, or 0.1%, to 2441.32, ending the week down 1.4%, its biggest loss since March. European and Asian indices were all in the red, although Japan's Nikkei 225 managed to lose just 0.05% overnight.

Asian markets swooned from the opening bell, and closed in the red.

The pan-European Stoxx 600 ended over 1% lower to a five-month low with nearly all sectors in negative territory.

Buying interest is somewhat subdued, however, as the ever-escalating war of words between President Donald Trump and North Korea continues to raise geopolitical concerns.

Away from the futures market, London-based gold bullion traders also reported brisk buying by global investors.

"While not necessary unexpected - as the U.S. had to respond to threats made by North Korea that they will fire rockets due to land just off the coast of Guam soon - new comments by Trump propelled stocks lower".

US Defence Secretary Jim Mattis told Pyongyang it should stop any actions that would lead to the "end of its regime and the destruction of its people".

Trump's remarks on Tuesday afternoon that North Korea would face "fire and fury like the world has never seen" weighed on Wall Street and drove up the VIX "fear gauge", or the cost of protection against a drop in the S&P 500.

On Thursday, the CBOE Volatility Index, a barometer of expected near-term stock market volatility, closed at its highest since the usa presidential election.

The precious metal enjoyed a 2.2% rise to $1292 per ounce, close to its high for the year.

On the economic front, data is expected to show that USA consumer prices likely rose in July after being unchanged the prior month.

The primary indicator of the week, consumer prices have slightly advanced in the month of July in the United States, but less than expected, according to figures released Friday by the ministry of Labour. The number of people who applied for USA unemployment-insurance benefits rose by 3,000 to 244,000 in the week ended August 5, the Labor Department reported.

USA producer prices also fell unexpectedly during July.

"The CPI data was very muted and not something which the Federal Reserve is going to be happy to look at", said Think Markets analyst Naeem Aslam. Both are voting members this year on the Fed's rate-setting committee. Against the euro, the dollar is valued at USD1.826 compared to yesterday's USD1.1772. Britain's FTSE 100 was down 1.1 percent. The index had its biggest drop since mid-May a day earlier.

Old Mutual fell 2.3%.

Overall it has been a strong stretch for corporate profits. The greatest contributors were investment return, which rose to GBP4.83 billion from GBP3.00 billion, and banking interest, which climbed to GBP2.36 billion from GBP1.61 billion.

Nvidia Corp.(NVDA) shares fell 5.3%, even after the chip maker posted upbeat earnings late Thursday. The company also said sales at its established stores declined for the fourth-straight quarter.

However, analysts at UBS Evidence Lab said Domino's market position is challenged with growing competition and United Kingdom consumer weakness, and that investment was needed to simply maintain its market position.

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