Finance News: Gold Shines As US-North Korea Tensions Mount

"If the USA should target North Korea, it would have to deal with North Korea's nuclear weapons, and there's also the possibility for Russian Federation and China to intervene", Yang said.

In the first four days of the week, the Standard & Poor's 500 index swung from marking its latest record high to posting its biggest single-day drop in almost three months. The major index futures are now pointing to a modestly higher open for the markets, with the Dow futures up by 21 points. "Limited news flow is what can be blamed for the narrow trading ranges, but expect this to change as we get closer to Friday's U.S. CPI release".

"Investors tend to be more cautious ahead of economic data, especially when the prices are high".

Seven of the 11 major S&P 500 sectors were higher, with the technology's 0.36 percent rise leading the advancers. The Dow Jones industrial average slid 204.69 points, or 0.9 percent, to 21,844.01, just shy of its low point for the day. The Nasdaq composite lost 99 points, or 1.6 percent, to 6,252.

The recovery fit a recent pattern of investors using dips to put more money in stocks. Netflix also fell, giving up $4.57, or 2.6 percent, to $173.79.

The North Korea situation isn't the only thing weighing on stocks.

"Trump's comments about North Korea have created nervousness and the fear is if the President really means what he said: "fire and fury"," said Naeem Aslam, chief market analyst at Think Markets in London.

North Korea raised the stakes further on Thursday with a detailed plan to send a salvo of missiles towards the US Pacific territory of Guam.

Still, there were fewer signs of anxiousness in the markets Friday. It's still the highest it's been since May.

Gold added to early gains, and the dollar pulled back, following the release of USA data showing a cooler reading for inflation at the wholesale level. The VIX rose further on Wednesday, rising as far as 12.11, its highest in nearly a month.

The all-important July inflation numbers out of the USA failed to satisfy dollar bulls' hopes of strongly putting a Fed rate hike later in the year back on the table. Seagate shares rose 69 cents to $32.24.

Traders sold off financial stocks amid speculation that the Fed will decide to hold off on raising interest rates next month.

But according to ICBC Standard Bank's Yuichi Ikemizu, the dollar is still weak and on a downtrend, which could help gold prices inch higher in the short term.

US stock futures were pointing to a weaker open on Friday. Gold miners bucked the 1.3 per cent fall for Australia's benchmark index.

The bond market was without direction: the yield of u.s. Treasury bills to 10 years, which evolves to the inverse of the bond price, appears to 2,190 %, compared to 2,198 % Thursday evening, and that bills to 30 years at 2,786 %, compared to 2,773 %.

Gold futures for December delivery climbed 1.3 percent to $1,278.50 an ounce at 9:02 a.m. on the Comex in NY.

In commodities, US. crude fell 0.67 per cent to $49.23 per barrel and Brent was last at $52.58, down 0.23 per cent on the day. Brent crude, used to price global oils, slid 52 cents, or 1 percent, to $52.18. Natural gas was also flat at $2.98 per 1,000 cubic feet. The Russell 2000 index of smaller-company stocks slipped 2 points, or 0.1 percent, to 1,370. Silver gained 1 cent to $17.07 an ounce.

BONDS: Bond prices rose.

Against the euro, the dollar is valued at $1.826 compared to yesterday's $1.1772.

Data showed the number of Americans filing for unemployment benefits unexpectedly rose last week, but the underlying trend remained consistent with a tightening labor market.

MARKETS OVERSEAS: Major indexes in Europe were mixed. The stock fell $1.07 to $5.17. Britain's FTSE 100 sank 1.4 percent. The Japanese markets were closed for a holiday.

Vanessa Coleman

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