Fresh DPRK tensions hit Wall Street

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US stocks sank on Tuesday, with the S&P 500 stumbling to its biggest single-day loss in about three weeks, as investors weighed fresh tensions with the DPRK.

The DPRK 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 Pyongyang's stand-off with Washington and its allies.

With US markets closed on Monday for the Labor Day holiday, Tuesday marked the first regular trading since the geopolitical developments.

“North Korea (the DPRK) seems to be what gets the biggest reaction, at least over the last month or two,” said Aaron Jett, vice president for global equity research at Bel Air Investment Advisors in Los Angeles.

The Dow Jones Industrial Average fell 234.25 points, or 1.07 percent, to 21,753.31, the S&P 500 lost 18.7 points, or 0.76 percent, to 2,457.85 and the Nasdaq Composite.

Reuters Photo

Wall Street may face a bumpy road in September, typically the worst month for stocks, if there is a showdown in Washington over the US budget and the federal debt ceiling.

Investors’ nerves on Tuesday also may have been heightened by news of a powerful storm heading to the southern United States closely on the heels of devastation in Texas from Hurricane Harvey.

Shares in home insurers with exposure to Florida tumbled as investors braced for losses as Hurricane Irma appeared set to hit the state.

Federal Reserve Governor Lael Brainard said the US central bank should delay raising US interest rates until it is confident inflation that is now “well short” of target will rebound.

Declining issues outnumbered advancing ones on the NYSE by a 2.34-to-1 ratio; on Nasdaq, a 2.14-to-1 ratio favored decliners. About 6.7 billion shares changed hands on US exchanges, above the 5.8 billion daily average over the last 20 sessions.

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Source(s): AP ,Reuters