North Korean "saber-rattling" sees gold hit two-month high

By Saqib Iqbal Ahmed

North Korea responded with threats to launch missiles into the Pacific Ocean near Guam, a USA territory. -North Korea tension also weighed on the Canadian dollar, which weakened against its US counterpart, despite higher oil prices and stronger-than-expected domestic housing data.

"Meanwhile, Trump knows that a conflict in North Korea could risk a huge amount of casualties and a huge humanitarian crisis on China's doorstep".

Markets were also lower in Europe and Asia.

Japanese markets were closed for a holiday but the tense mood dragged Asian shares lower and an MSCI index of stocks across the globe was on track to post its largest weekly drop since the week before Donald Trump won the US presidential election in November.

The dollar fell sharply against the Swiss franc Wednesday, with haven assets including Switzerland's currency bid higher following a verbal clash between North Korea and U.S. President Donald Trump.

Trump's threat earlier this week, to unleash "fire and fury" on Pyongyang if it attacked, was ultimately dismissed as bluster by many investors.

The dollar widened losses against the yen to hit a two-month low.

The tension and severity of the potential consequences of further escalation have effected equities, thereby making the safe-haven of gold attractive to investors.

German bond yields fell, gold and the Japanese yen surged and the leveraged bets on higher yielding currencies such as the Australian dollar took a beating. Brent crude, used to price global oils, added 4 cents to $52.74.


Energy stocks retreated 0.5 percent, despite higher oil prices.

The recent resilience of data on the United States economy has not dampened the latest climb, despite depressing prices earlier in the week as reports returned high employment figures ahead of further USA inflation information this week.

The bombing of Pearl Harbor, for instance, resulted in a 3.8 percent drop in the S&P 500 on December 7, 1941.

The Toronto Stock Exchange's S&P/TSX composite index fell 39.02 points, or 0.26 percent, to end at 15,217.33. But for the week the S&P 500 lost 1.3 percent, its worst weekly showing since March. News Corp tumbled 5.4% and REA Group slumped 6% after disappointing full-year results.

High-flying technology names suffered outsized losses on the day, with Apple falling 3.2 percent, Amazon 2.6 percent and Facebook 2.2 percent.

A report released by the Labor Department showed a modest uptick in consumer prices in the United States in the month of July.

Gold prices, which hit a two-month low on Thursday, were steady at $1,286.31 an ounce, after surging over 2 percent in the past two sessions.

Macy's shares closed down 10.2 percent and Kohl's fell nearly 6 percent as the companies continued to report a drop in quarterly same-store sales, stoking concerns that their turnarounds may still be a long way off.

A report on consumer price inflation is likely to attract attention on Friday, with consumer prices expected to rise by 0.2 percent in July.

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