Markets

North Korea tensions send dollar to eight-week low vs yen

North Korea tensions send dollar to eight-week low vs yen

US stocks headed lower in early trading Wednesday, Aug. 9, 2017, as traders weighed the growing tensions between the USA and North Korea.

Investors have been jittery about North Korea since Tuesday when Trump said any threats from Pyongyang would be "met with fire and fury like the world has never seen".

The CBOE Volatility Index, a barometer of expected near-term stock market volatility, closed at its highest since the election.

Aug 11 (Reuters) - U.S. stocks were modestly higher in late morning trading on Friday as investors cautiously dipped back into riskier assets, after a three-day losing streak on concerns over escalating tensions between the United States and North Korea. The South Korean won sank around 0.8 per cent to 1,133.8 to the dollar, its lowest since July 14.

The verbal escalation has been further fuelled on Friday by president Donald Trump, who has warned that if the north Korean leader attacked Guam, Pacific island and american territory, he " would regret ".

The greenback also came under pressure after New York Federal Reserve President William Dudley cautioned it would "take some time" for United States inflation to reach the bank's two percent target, the latest warning price pressures remain muted.

On Thursday, New York Fed President William Dudley said he expects sluggish US inflation to rise over the next several months while the hot labor market gets even hotter.

Outside the political arena, declines in a pair of technology stocks added to the cautious tone on the day.

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The Labor Department said its consumer price index inched up by 0.1% in July after coming in unchanged in June.

After North Korea claimed Trump is "driving" the Korean peninsula to the "brink of a nuclear war", the president responded with a tweet suggesting the USA is prepared to take military action against the communist nation.

The Dow Jones industrial average closed up 14 points, a gain of 0.07 percent, the Nasdaq composite rose almost 40 points or 0.64 percent and the S&P 500 gained 3 points or 0.13 percent. Shanghai Composite Index tumbled 1.6 percent to 3,208.54. The Fed, which raised its key interest rate in March and June, has signaled it plans a third rate hike before the end of this year.

Shares in several other big media companies also declined.

The 30-year bond last rose 28/32 in price to yield 2.7759 percent, from 2.818 percent late on Wednesday.

J.C. Penney slumped as much as 18.25 percent to a record low after the retailer reported a bigger-than-expected quarterly loss.

"A global stock market fund will have its fair share of value and growth companies, unlike -say- the FTSE 100 index which is predominately value-orientated with its bias towards energy, mining and financial, or the Japanese TOPIX which is growth-orientated with a predominance of consumer goods companies". On the Nasdaq, 1,440 issues fell and 1,386 advanced. Major indexes in Asia closed lower.

The dollar was down 0.77 percent against the yen at 109.21 yen.