Stock Futures Lower Again as North Korea Tensions Intensify

The Standard & Poor's 500 index fell 5.99 points

All three major stock indexes dropped 0.2 per cent at the close, with the Dow Jones Industrial Average finishing at 22,085.34, halting a almost two-week run of closing records.

Simmering tensions between the USA and North Korea have come back to the boil in recent days after Pyongyang disclosed plans to fire missiles over Japan to land near America's Pacific territory of Guam.

Canada's main stock index turned slightly higher in early trade on Wednesday, as gains for gold miners and energy companies with higher commodity prices offset falls among financials.

Earlier on Thursday, North Korea revealed a plan to launch ballistic missiles toward a major US military hub in the Pacific. "That did temporarily shake investors' complacency, but we think markets are ready to move higher in the back half of the year, and earnings and economic data are going to drive that".

The Dow slid as declines in shares of Apple and those of Goldman Sachs, recently down 2.3 percent and 1.7 percent respectively, outweighed gains in shares of McDonald's and those of Coca-Cola, recently up 1.4 percent and 0.5 percent respectively.

The S&P's record close on August 7 likely helped fuel its latest sell-off.

Positive sentiment was also generated by a report from the Labor Department showing a modest uptick in consumer prices in the month of July.

Shane Oliver, head of investment strategy at AMP Capital in Sydney, said: "What has changed this time is that the scary threats and war of words between the United States and North Korea have intensified to the point that markets can't ignore it".

Investors, who took the North Korea report from Japan in their stride earlier in the day, lost their appetite for risk after Trump's comments to reporters during his vacation at his golf club in New Jersey.

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The CBOE Volatility Index, the most widely followed barometer of expected near-term stock market volatility, closed at its highest in about a month.

Shares rose more than 1.3% or 4.9p to 388.5p.

The VIX rose further on Wednesday, rising as far as 12.11, its highest in nearly a month.

Priceline sank 6.9 per cent as it projected third-quarter earnings below analyst expectations.

USA trading volume has been low with summer setting in and Congress expected to be in recess until September 5. That is significant because yields fall when bond prices rise. Brent crude, used to price global oils, rose 20 cents to $52.10 a barrel in London. Copper rose 1 cent to $2.91 a pound.

The Japanese yen strengthened by 0.5 per cent to around 109.70 per dollar. It was last up 1.2 percent at 1.1305 per euro.

"Trump's response was aggressive and that's why the market turned lower", said Ken Polcari, Director of the NYSE floor division at O'Neil Securities.

Manulife Financial Corp was down 1.1 percent to C$25.64. South Korea's Kospi lost 1.7 percent, while Hong Kong's Hang Seng slid 2 percent.

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