Stocks rally, but end a bit lower

Stocks rally, but end a bit lower

South Korean shares fell to an 11-week low on Friday and the won extended this week's slide as President Donald Trump warned North Korea again not to strike Guam or USA allies.

The broader Topix fell 1.1 percent to 1,617.90 and the JPX-Nikkei Index 400 shed 1.0 percent to 14,375.72.

US stocks closed slightly lower Wednesday, making up much of the ground they lost earlier after a rare batch of earnings disappointments by Walt Disney and other big companies.

European shares were also lower following reports that a auto had rammed a group of soldiers in Paris, injuring six before speeding off in what officials identified as a suspected terrorist attack.

The focus on North Korea largely overshadowed a Labor Department report showing an unexpected drop in U.S. producer prices in the month of July.

The Standard & Poor's 500 index rose 0.1% to 2,482 as of 1:45 p.m.

Trump had told North Korea to not "make any more threats" to the USA or the country "will be met with fire and fury like the world has never seen".

Geopolitical concerns continued to weigh on Wall Street amid an ongoing escalation in tensions between the United States and North Korea.

How a North Korean attack could play out
Trump added that the USA would be putting more money into its $40 billion ballistic missile defense system. Navy aircraft carrier strike group or Marine Corps Expeditionary Unit off the Korean Peninsula right now.

"I think the muted reaction in the market has to do with Trump not necessarily following up on his tough talk", Pavlik said.

Gold prices continued to move higher for the second day yesterday and the prices are trading comfortably above $1270 as of this writing.

Investors' unease over escalating tensions between the US and North Korea had weighed on stocks earlier in the day, pushing gold and bond prices slightly higher.

In New York, the Dow Jones industrial average plunged 204.69 points to 21,844.01, while the S&P 500 index dropped 35.81 points to 2,438.21 and the Nasdaq composite index slid 135.46 points to 6,216.87. The Nasdaq composite lost 36 points, or 0.6 percent, to 6,315.

Global stock markets are firmly in the red after another escalation of tensions between North Korea and the United States.

"Uncertainty over geopolitical tensions on the Korean peninsula hit when market was already sluggish on a seasonal slowdown in activity in the summer", said Mutsumi Kagawa, chief global strategist at Rakuten Securities.

Among European markets, Britain's FTSE 100 fared the worst, down 1.10% as 80% of index members tumbled, led by the telecommunication sector.

The pan-European STOXX 600 was down 0.7% at closing, France's CAC 40 fell 1.4% after a vehicle hit a group of soldiers in Paris in what is thought to have been a deliberate act, and a fall in bond yields saw Germany's DAX down 1.1%. The yield on the 10-year Treasury note rose to 2.27% from 2.26%. Copper fell 2 cents to $2.90 a pound.

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