Wall Street futures pointed to a lower open on Tuesday

Wall Street futures pointed to a lower open on Tuesday

 

Investing.com – Wall Street futures pointed to a lower open on Tuesday, with the Dow set for a triple-digit slide, as geopolitical tensions involving North Korea flared, causing traders to exit equities in favor of safe haven assets.

The blue-chip Dow futures lost 108 points, or 0.50%, at 6:56AM ET (11:56GMT), the S&P 500 futures fell 16 points, or 0.63%, while the tech-heavy Nasdaq 100 futures traded down 49 points, or 0.84%.

North Korea fired a missile during early Asian hours that flew over Japan and landed in the Pacific about 1,180 kilometers (735 miles) off the northern region of Hokkaido, in a sharp escalation of tensions on the Korean peninsula.

Japanese prime minister Shinzo Abe called the missile launch an “unprecedented and grave threat” to the country’s security.

The U.S., Japan and South Korea asked for a United Nations Security Council meeting to discuss the test, diplomats said, with a meeting of the 15-member Security Council expected to be held later in the day.

Wall Street futures pointed to a lower open on Tuesday

Global stock markets tumbled in risk-off trade Tuesday with Asian equities, particularly in Tokyo and Seoul closing lower.

Europe bourses also slumped nearly 2% to their lowest levels in six months.

Global markets were shaken earlier this month after U.S. President Donald Trump cautioned that North Korea would be met with “fire and fury” if it continued to make threats against the U.S.

Traders opted to take risk off the table Tuesday as they waited to see Trump’s reaction to the provocation to see if the President would escalate tensions or provide a tempered response.

As investors took money out of equities, they piled into traditional safe haven assets.

Gold prices jumped to a 10-month high as investors sought safety in the precious medal.

By 6:58AM ET (11:58GMT), gold for December delivery on the Comex division of the New York Mercantile Exchange was up 0.76% at $1,325.31.

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Wall Street futures pointed to a lower open on Tuesday

 

Demand for safe haven currencies such as the yen and Swiss franc were also on the rise. At 6:59AM ET (11:59GMT), the dollar lost around 0.6% against the yen to 108.54 after touching a more than four-month low of 108.27 earlier, while USD/CHF fell 1.15% to 0.9441.

Investors also rushed to the safety of U.S. Treasuries, pushing down the 10-year yield to a nine-month low of 2.086% earlier on Tuesday.

On the economic front, investors will gauge the strength of the U.S. housing market with the publication of the S&P Case Shiller home price index for June at 9:00AM ET (13:00GMT).

Then at 10:00AM (14:00GMT), the Conference Board will release its consumer confidence reading for August.

While waiting for the data, the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, lost 0.44% to 91.76 by 7:02AM ET (11:02GMT).

On the company front, market participants will eye earnings from the likes of Best Buy, H&R Block (NYSE:HRB) or J.Jill.

Wall Street futures pointed to a lower open on Tuesday

Meanwhile, energy markets continued to weigh the damage from Hurricane Harvey in Texas.

Massive floods caused by Harvey forced several refineries to close along the U.S. Gulf Coast, while heavy rains were spreading into the greater Houston area, which has already been hit by catastrophic flooding.

The storm, which made landfall on Friday, is poised to regain strength before crashing ashore again near the Texas-Louisiana border Wednesday.

Wall Street futures pointed to a lower open on Tuesday

U.S. crude oil futures dropped 0.19% to $46.48 at 7:03AM ET (11:03GMT), while Brent oil traded down 0.58% to $51.12.

 

Wall Street futures pointed to a lower open on Tuesday

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