By Yashaswini Swamynathan
U.S. stocks edged lower on Tuesday as rising geopolitical tensions in the Middle East and the Korean peninsula pushed investors to safe-haven assets such as gold. The White House said on Monday President Donald Trump was open to authorizing additional strikes on Syria if its government uses chemical weapons again or deploys barrel bombs, while North Korea warned of a nuclear attack on the United States if provoked as a U.S. Navy strike group moved towards the western Pacific. Prices of safe-haven gold rose, with spot gold up the most in over two weeks. Investors also ditched riskier assets for the Japanese yen and U.S. Treasuries. The dollar index slipped by the most in about two weeks and oil prices eased from five-week highs."Heightening geopolitical fears are likely to constrain investors from a mood change...(and) are likely to keep the safety trade, gold and U.S. Treasuries, in play," Peter Cardillo, chief market economist at First Standard Financial wrote in a note.At 9:42 a.m. ET (1342 GMT), the Dow Jones Industrial Average was down 52.2 points, or 0.25 percent, at 20,605.82, the S&P 500 was down 9.26 points, or 0.39 percent, at 2,347.9 and the Nasdaq Composite was down 22.45 points, or 0.38 percent, at 5,858.47.
Investors also preferred to hold their bets ahead of the start of the first-quarter earnings season, which is set to kick off on Thursday when three big U.S. banks report. A rally in financial shares has fizzled recently as investors fret over lofty valuations and Trump's ability to make good on his pro-growth promises.Nine of the 11 major S&P 500 sectors were lower. Financials were the biggest losers, down 0.6 percent.
Bank of America and Wells Fargo were the top drags on the S&P, while Goldman Sachs and JPMorgan weighed the most on the Dow. Walt Disney boosted consumer discretionary stocks after being added to Goldman's conviction list. Consumer staples and real estate - sectors that have predictable growth and are favored during uncertainty - were the other gainers.
Trump will meet with about 20 chief executives, including the heads of General Motors, IBM and Wal-Mart, as he seeks to garner support for a $1 trillion infrastructure program, tax reforms and other administration priorities. Shares of online coupon provider RetailMeNot jumped nearly 50 percent to $11.55 after agreeing to be bought by marketing services company Harland Clarke. Western Digital was up 2.9 percent at $87.17, following a JPMorgan upgrade to "overweight" from "neutral". Declining issues outnumbered advancers on the NYSE by 1,738 to 897. On the Nasdaq, 1,398 issues fell and 878 advanced.The S&P 500 index showed three 52-week highs and one low, while the Nasdaq recorded 22 highs and 17 lows. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Sriraj Kalluvila)
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Published Date: Apr 11, 2017 21:55 PM | Updated Date: Apr 11, 2017 21:55 PM