Economy

U.S. stock futures lower as North Korea tensions rise

U.S. stock futures lower as North Korea tensions rise”

European markets closed lower; London's FTSE lost 0.4 per cent, Paris is down 0.4 per cent and Frankfurt was also down 0.3 per cent. Natural gas slid 10 cents, or 3.2 percent, to $2.97 per 1,000 cubic feet.

The CBOE Volatility index.VIX, the most widely followed barometer of expected near-term stock market volatility, rose 2.10 points to 12.23.

September is typically the worst month in the year for stocks, with the S&P falling 0.5 percent on average. Stocks in Taiwan and Southeast Asia were all lower.

South Korea said on Tuesday an agreement with the United States to scrap a weight limit on its warheads would help it to respond to the threat from North Korea after Pyongyang conducted its sixth and largest nuclear test two days ago. On Tuesday, President Donald Trump said in his tweet that he has given the go-ahead for Japan and South Korea to buy a "substantially increased amount" of sophisticated military equipment from the United States.

Wall Street may face a bumpy road in September, typically the worst month for stocks, if there is a showdown in Washington over the USA budget and the federal debt ceiling.

ANALYST'S TAKE: President Trump's tweets, "were seen as provocations on the USA end, feeding jitters into the market".

With the USA stock markets closed, there was no U.S. economic data to digest.

Wall Street opened lower on Tuesday as investors remained cautious after North Korea conducted its most powerful nuclear test over the weekend.

Investors' nerves on Tuesday also may have been heightened by news of a powerful storm heading to the southern United States closely on the heels of devastation in Texas from Hurricane Harvey.

The Standard & Poor's 500 index fell 19 points, or 0.8 percent, to 2,457.

Dow Jones mini futures declined 61 points to reach 21,919.00. The average had been down more than 277 points. The Nasdaq composite dropped 59 points, or 0.9 percent, to 6,375. The Russell 2000 index of smaller-company stocks gave up 13.92 points, or 1 percent, to 1,399.66.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., September 5, 2017. Energy companies climbed the most as the price of crude oil rose.

CURRENCIES: The dollar declined to 108.62 yen from 108.79 yen.



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