Fear of North Korea attack sends Wall Street spiraling

Fear of North Korea attack sends Wall Street spiraling

Fear of North Korea attack sends Wall Street spiraling

Wall Street fell, giving up earlier gains that had sent the Dow to a fresh record high, after US President Donald Trump issued a warning to North Korea, illustrating intensifying tension between the two nations. The Dow is down 61.31 points or 0.3 percent at 22,024.03, the Nasdaq is down 30.87 points or 0.5 percent at 6,339.59 and the S&P 500 is down 5.90 points or 0.2 percent at 2,469.02.

"Trump's comments about North Korea have created nervousness and the fear is if the president really means what he said "fire and fury".

The comments came after reports said the USA intelligence community has determined that North Korea has successfully produced a miniaturized nuclear warhead that can fit inside its missiles.

A notable decline by Disney (DIS) is weighing on the Dow, with the entertainment giant slumping by 3.9% on the day.

Burger chain Wendy's was up 4.20 percent after it reported better-than-expected quarterly profit and sales.

On the United States economic front, the Labor Department released a report showing labor productivity increased by slightly more than expected in the second quarter.

Despite more frequent sabre-rattling by the North, the index has been among the strongest performers in the world so far this year, gaining more than 17 per cent. Microsoft also managed to avoid market selloff with a 0.5 percent increase.

Unit labor costs had been expected to climb by 1.2% compared to the 2.2% jump that had been reported for the previous quarter.

Considerable weakness is also visible among tobacco stocks, as reflected by the 1.1% drop by the NYSE Arca Tobacco Index. It fell to as low as 2,371.28 earlier, its lowest intraday level since June 23.

Oil service stocks showed a significant move to the downside on the day, dragging the Philadelphia Oil Service Index down by 1.9%.

Meanwhile, the major European markets moved modestly higher over the course of the session.

Markets in Canada's largest centre were set to follow global markets lower on Wednesday as investors held back from betting on riskier assets amid escalating North Korea tensions. "The typical textbook trade is that investors rush for safe haven, hence we have experienced a bounce for the gold price".

Seven of the 11 major S&P sectors were lower, with the consumer discretionary index's 10.2 percent fall leading the decliners.

Nevertheless, traditional safe havens jumped, with the benchmark 10-year US note yield hitting its lowest level since June 28 and gold futures surging more than 1 percent. The UK's FTSE 100 Index increased 0.1%, France's CAC 40 Index rose 0.2% and Germany's DAX Index added 0.3%.

Bond prices didn't move much.

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