The FTSE 100 slipped by50 points, to 7,394, after having fell by 44 points on Wednesday and 108 points yesterday. The Producer Price Index (or PPI) fell 0.10%, while the market had forecast a rise of 0.10%.
USA crude oil futures settled almost 2 per cent lower at $48.59 a barrel, as Russian Federation considered a future output resumption and the Organization of the Petroleum Exporting Countries boosted its July production numbers.
European markets closed lower: London’s FTSE lost 0.6 per cent, Paris fell 1.4 per cent and Frankfurt dipped 1.1 per cent. Its weekly gain of 2.6 per cent is the largest since June 2016.
“U.S. markets had previously been becalmed amidst the Goldilocks scenario of strong profit growth, low interest rates and full valuations”. According to a report in the New York Times, Trump’s “fire and fury” comment which dramatically escalated tensions between the United States and North Korea was… entirely improvised. Utilities was the only sector that closed positive on August 10.
The Japanese yen hit an eight-week high against the USA dollar, while spot gold also reached a two-month high.
Overseas markets were also lower Wednesday.
Manulife Financial Corp was down 1.1 percent to C$25.64.
“Generally, earnings are good, .it’s our view that this pullback (in stocks) should provide good buying opportunities”, ABC Funds’ Michael said.
Wall Street stocks posted their biggest declines in almost three months late Thursday as US President Donald Trump doubled down on his warnings to North Korea over its nuclear program. He also said the nuclear-armed nation should be “very, very nervous” if it even thinks about attacking the United States or its allies. “North Korea responding with a threat to US territory after Trump warned them not to threaten the USA was never going to go down well”, Lawler said.
Many world stock markets have hit record or multi-year highs in recent weeks, leaving them vulnerable to a selloff, and the tensions over North Korea proved to be the trigger.
The index was showing signs of Greed just two days ago while the Dow was in the midst of a winning streak that included nine straight record highs.
The Dow Jones Industrial Average fell 94.55 points, or 0.43 percent, to 21,954.15, the S&P 500 lost 19.51 points, or 0.79 percent, to 2,454.51 and the Nasdaq Composite dropped 76.39 points, or 1.2 percent, to 6,275.94.
Trading volume also picked up in the late afternoon of what had been a sleepy summer session while the U.S. Congress is expected to be in recess until Sept 5. “You’re less than 2 per cent off the high for the S&P heading into a weekend where uncertainty with North Korea still lingers”.
Despite the past week’s decline, the major indexes are in positive territory so far this year, led by the Nasdaq, which is up 16.2 percent.
But “the yen may be expected to lose its safe haven status if U.S”.
The VIX, a measure of Wall Street volatility, spiked more than 30% Thursday.
Shares of US department stores Kohl’s and Macy’s were weak after their results.
Declining issues outnumbered advancing ones on the TSX by 161 to 87, for a 1.85-to-1 ratio on the downside.