Bargain Hunting Contributes To Early Strength On Wall Street

Bargain Hunting Contributes To Early Strength On Wall Street

Bargain Hunting Contributes To Early Strength On Wall Street

Amid the hot rhetoric, US stocks sold off sharply on Thursday, with the S&P 500 falling more than 1 percent.

But U.S. stocks regained some lost ground, despite Trump's comments Friday that U.S. weapons are "locked and loaded", ready to respond if North Korea acts "unwisely". With the sell-off on the day, the Nasdaq and the S&P 500 fell to their lowest closing levels in a month.

"There's not a great incentive to buy big", said Lerner of SunTrust Advisory.

"This situation is beginning to develop into this generation's Cuban Missile crisis moment, with recent leaked intelligence reports alleging that North Korea now has miniaturised its nuclear warheads, which extends the range of its missiles, and potentially brings USA targets into reach", ING's chief Asia economist Robert Carnell said in a research note on Friday. The Dow is up 34.62 points or 0.2 percent at 21,878.63, the Nasdaq is up 25.62 points or 0.4 percent at 6,242.49 and the S&P 500 is up 4.36 points or 0.2 percent at 2,442.57.

London's benchmark FTSE 100 index shed 0.9 per cent to 7,323.45 points.

In overseas trading, stock markets across the Asia-Pacific region saw continued weakness during trading on Friday.

Railroad stocks have shown a strong move to the upside on the day, driving the Dow Jones Railroads Index up by 1.3 percent.

The CBOE Volatility Index, the most widely followed barometer of expected near-term U.S. stock market volatility, hit its highest mark since November 8, when Trump was elected president.

The modest rebound came at the end of a turbulent week on Wall Street as escalating tensions between the USA and North Korea rattled global markets.

The yen on Friday added to a strong weekly rally against the dollar of close to 1.5 percent, hitting its highest level versus the greenback in nearly four months, at 108.73 yen JPY= .

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The yen tends to benefit during times of geopolitical or financial stress as Japan is the world's biggest creditor nation and there is an assumption that Japanese investors will repatriate funds should a crisis take place.

Wall Street rebounded on Friday and ended on a good note in a hard week marked by increasing geopolitical tensions: the Dow Jones has taken 0.1% and the Nasdaq up 0.6 per cent.

The dollar was further weighed down on Friday by the soft USA inflation data. "We could see a huge drop in the stock market - but we'd have to get to that point", Cardillo said.

The pound was unchanged against the dollar at $1.2981 and up 0.15% against the euro at 1.1040 euros.

The Japanese yen last strengthened 0.03 per cent versus the greenback at 109.22 per dollar.

Adding to the modest losses posted in the two previous sessions, stocks moved sharply lower over the course of the trading day on Thursday. "There are four more (inflation) prints between now and the December FOMC meeting and we expect the Fed to remain data-dependent, if a touch more cautious", TD Securities said in a note.

And in bond markets, 10-year US Treasuries and Germany's ultra-safe government bonds, known as Bunds, were trading at their highest prices since June.

The 30-year bond US30YT=RR last rose 6/32 in price to yield 2.7847 percent, from 2.794 percent late on Thursday.

US crude futures extended losses from Thursday, when they tumbled 2 percent on fears of slowing demand and lingering concerns over a global oversupply.

USA crude CLcv1 rose 0.43 percent to $48.80 per barrel and Brent LCOcv1 was last at $52.01, up 0.21 percent on the day.

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