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Gold soars as the U.S. and North Korea wage a verbal war

13 August 2017

European markets also slid in early trade after Wall Street indices suffered their biggest losses in almost three months Thursday, while the dollar struggled to recover from eight-week lows below 109 yen as investors fled to safe haven assets.

"As a portfolio manager, you say, 'Do I think we'll get a war out of this?'" said Torsten Slok, chief global economist at Deutsche Bank, referring to the back and forth between North Korea and President Donald Trump.

Wall Street's so-called "fear gauge", the CBOE Volatility Index, eased after hitting its highest levels since Election Day on Friday (http://www.marketwatch.com/story/wall-streets-fear-gauge-on-course-for-biggest-weekly-surge-in-2-years-2017-08-11).

South Korean stocks ended lower Friday as foreign investors sold local stocks amid escalating tensions between North Korea and the United States.

North Korea Has Markets Nervous But Not Panicked
Japan is the world's biggest creditor country and there is an assumption investors there will repatriate funds in a crisis. The Nasdaq Composite Index plunged 2.1% to 6216.87 and the Standard & Poor's 500 Index dropped 1.45% to 2438.21.

While North Korea is likely to remain in focus, a report on consumer price inflation may also attract attention on Friday, with consumer prices expected to rise by 0.2% in July.

The nuclear-armed nation said it was finalizing plans to fire four intermediate-range missiles over Japan to land 18-25 miles from Guam.

The smaller than expected increase in consumer prices has led to optimism that the Federal Reserve will not be in a hurry to raise interest rates.

"Given the great run we've had, seems like some sort of pullback wouldn't be surprising", said Michael Baele, managing director of investments at U.S. Bank Private Wealth Management.

Paris to consider video games for 2024 Olympics
Estanguet also had some thoughts for esports skeptics out there: "We have to look at it because we can't say, 'It's not us". By 2022, it will become an official sport at the event, although it is unknown which games would be contested.

At 12:43 p.m. ET (1643 GMT), the Dow Jones Industrial Average was up 49.69 points, or 0.23 percent, at 21,893.7 and the S&P 500 was up 6.84 points, or 0.28 percent, at 2,445.05. Shares of Manulife, which reported better-than-expected results, fell after the company played down talk of a John Hancock spin-off. Investors welcomed new data showing US inflation at the consumer level inched higher last month, suggesting that the Federal Reserve may be less likely to raise interest rates next month. The slide deepened after Trump's remarks on North Korea. The Dow slumped 204.69 points or 0.9% to 21,844.01, the Nasdaq plummeted 135.46 points or 2.1% to 6,216.87 and the S&P 500 tumbled 35.81 points or 1.5% to 2,438.21.

On the currency front, the USA dollar is trading at 108.82 yen compared to the 109.20 yen it fetched at the close of NY trading on Thursday.

China's Shanghai Composite Index plunged 51.94 points or 1.6% to 3,209.80, as investors continued to book profits in cyclical sectors. Germany's DAX dipped 0.1 per cent as the CAC 40 fell 1.1 per cent in Paris.

Traders snapped up shares in companies that delivered strong quarterly results. The yield on three-year Treasurys fell 2.0 basis points to 1.804 percent and the return on benchmark five-year government bonds shed 2.0 basis points to 2.004 percent. On the Nasdaq, 1,787 issues fell and 564 advanced.

United States stocks snap 3-day losing streak in roller coaster week
Trump's comments came after reports that North Korea has spurned a new round of sanctions approved by the UN Security Council. Crude oil futures are slipping USD0.10 to USD48.49 a barrel after tumbling USD0.97 to USD48.59 a barrel on Thursday.

Crude oil prices extended their slide as exports from key OPEC producers rose, despite news of lower crude shipments from Saudi Arabia.

Gold soars as the U.S. and North Korea wage a verbal war