Tension arise in North Korea and Wall Street drops

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Tension arise in North Korea and Wall Street drops

Tension arises, Wall Street drops

After the verbal threats between the United States and North Korea, the nervousness of investors has increased, leading to heavy losses on Wall Street.

New York Park has lived its worst day since May, having a very strong contrast in the spate of records accumulated last week. At the end of the session, the Industrual Dow Jones lost 0.93%, while S&P 500 lost 1.45% and Nasdaq, having the strongest fall, dropped 2.13%.

Wall Street’s major indicators have fallen since the beginning of the session this week, after the President of North Korea reiterated threats against the United States.

Among the threats, North Korea insisted that they had the island of Guam in sight with four ready-medium range missiles ready to be thrown in its direction if the leader of the country, Kim Jong-Un gave the order to do so. It is noteworthy that the US posses several military bases in the island.

US - Guam Military Base

One of the US Military Bases in Guam 

According to a statement by Pyongyang, that is a plan made as a warning sign to the United States, however, Donald Trump doesn’t seem to be willing to reduce the tension between the two countries, but quite the opposite.

United States threats and their implications

Trump threatened the Korean nation in the past weeks, with fire and fury, he also reassured that his words were not harsh enough for what he has prepared if the Korean nation attacks the island belonging to the United States. He also insisted that if they are attacked, North Korean citizens would suffer things they haven’t seen before.

Said crisis triggered volatility on Wall Street, after some really quiet weeks,not seen before, and filled with an optimism of where the economy was headed and the good running of large United States companies.

However, experts say that they had expected some kind of correction in the market, this is natural after the records that had been showing in the stock market recently.

There are many periods on the rise, and many times this becomes followed by setbacks, that is exactly what we are seeing now, this is what William Hamly told The Wall Street Journal.

At the moment, few experts dare to venture if the losses of recent days indicate a long-term trend or without something more cyclical.

Among the large disadvantage of this session, we have technological values that were having excellent earnings accumulated throughout the year, now show themselves as the most sensitives when the market turned.

Technology companies fell 2.22%, with clear setbacks for the giants of the sector, such as Apple with a loss of 3.22% Facebook by 2.21%, Alphabet lost 1.75% and Microsoft dropped 1.46%.

On another note, due to the fears of North Korea, investors have opted for safer assets such as gold, which this week has risen by 2% and reached its highest price in two months. They also bet on currencies like yen or Swiss franc.

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