US stocks were back in the black on Friday, but it wasn’t enough to undo the damage inflicted by days of verbal wrangling between the US and North Korea that saw Wall Street clock its steepest weekly slide since March.
The S&P 500 fell 1.43 per cent over the past five trading days to 2,441.37, as energy led the declines with a 0.7 per cent drop. The Dow Jones Industrial Average, by comparison, declined 1.1 per cent over the week to 21,858.05, while the Nasdaq Composite ended 1.5 per cent lower at 6,256.56 — its steepest drop in six weeks.
The sell-off came as US President Donald Trump escalated the war of words against the North Korean regime’s accelerated programme of nuclear testing. Mr Trump tweeted on Friday that “military solutions are now fully in place, locked and loaded, should North Korea act unwisely”.
The geopolitical concerns also gave another jolt to volatility. The CBOE’s Vix index, a closely watched as a gauge of anxiety among equity investors, rising 5.46 points (about 54 per cent) to 15.49 over the week, having touched a record intraday low of 8.84 less than two weeks ago.
Jittery investors also sought out haven assets, sending gold prices sharply higher. The yellow metal surged 2.5 per cent over the week to $1,290.79 a troy ounce — its biggest weekly gain in more than a year.
Elsewhere, a string of dovish remarks from Federal Reserve policymakers and soft inflation readings saw the US dollar weaken. The dollar index, which gauges the buck against a basket of six peers, fell 0.5 per cent to 93.07.