Wall Street lower as North Korea tensions weigh

Updated: Tue, Sep 05, 2017
09:23 pm
Reuters
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U.S. stocks were lower in late morning trading on Tuesday, with the Dow Jones Industrial Average shedding more than 150 points as tensions around North Korea continued to weigh.

North Korea on Sunday conducted its sixth nuclear test, which it said was of an advanced hydrogen bomb for a long-range missile, marking a dramatic escalation of the regime`s stand-off with the United States and its allies.

"It looks as though escalation has gone to the next level, but there are lot of things in the coming weeks that may be causing people to get a little bit more cautious," said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.

Wall Street may face a rough ride in September, typically the worst month for stocks, if there is a showdown in Washington over the U.S. budget and the federal debt ceiling.

At 10:43 a.m. ET (1443 GMT), the Dow Jones Industrial Average was down 167.01 points, or 0.76 percent, at 21,820.55 and the S&P 500 was down 11.95 points, or 0.48 percent, at 2,464.6.

The Nasdaq Composite was down 29.90 points, or 0.46 percent, at 6,405.43.

Nine of the 11 major S&P sectors were lower. Financial stocks were the worst hit, falling 1.46 percent, after an influential Federal Reserve policymaker struck a dovish tone on interest rates.

Fed Governor Lael Brainard said U.S. inflation is falling "well short" of target so the central bank should be cautious about raising interest rates any further until it is confident that prices are headed higher.

Goldman Sachs` fell 3.4 percent, dragging down the Dow; while the S&P was pulled lower by a more than 2 percent fall in shares of JPMorgan and Bank of America.

"As far as interest rates go, everyone`s on a holding pattern to see what happens. No one`s expecting a September rate hike anyway, but we`ve got a lot of data until December that could change the chances of a rate hike," Frederick said.

Minneapolis Fed President Neel Kashkari and his Dallas counterpart, Robert Kaplan, are also slated to speak at different events later in the day.

Data showed new orders for U.S.-made goods recorded their biggest drop in nearly three years, but orders for capital goods were stronger than previously reported, pointing to robust business spending at the start of the third quarter.

Shares of United Technologies were down 3.9 percent after the company struck a $30 billion deal to buy avionics and interiors maker Rockwell Collins. Rockwell shares were up 0.75 percent.

Insmed shares more than doubled after the company said its drug for the treatment of a rare and serious lung disorder met the main goal in a late-stage study.

Declining issues outnumbered advancers on the NYSE by 1,674 to 1,046. On the Nasdaq, 1,671 issues fell and 1,082 advanced.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)

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