Asian markets bounce back as North Korean threat recedes

Asian markets bounce back as North Korean threat recedes

“They are thinking twice because risk-off means buying yen, but Japan is too close from a geopolitical perspective,” said Kyoya Okazawa, head of global markets for BNP Paribas in Japan. As such, short-yen positioning could be capping the currency Tuesday, he added.

The Trouble With Netflix More To Come

The Trouble With Netflix More To Come

Netflix shares fell only five percentage points this past week, even as the company’s key vulnerability was laid bare for investors—twice. Walt Disney, a vital source of Netflix content, said it will pull Disney and Pixar movies and shows after next year to start its own streaming service. And Facebook launched a video service with niche shows covering sports, cooking, reality contests, social-media celebrities, and more. For now, it’s far from a threat to the runaway leader in subscription streaming, but then, when Netflix was founded 20 years ago this month, it was far from a threat to Blockbuster.

Stock market closes lower on North Korea tensions; Disney, Goldman kneecap Dow

U.S. stocks closed down Wednesday, but off session lows as tensions between North Korea and the U.S. added a dollop of geopolitical uncertainty to markets, and as high-profile companies disappointed with their quarterly results. 

The Dow Jones Industrial Average DJIA, -0.17% declined 36.64 points, or 0.2%, to close at 22,048.70, after briefly losing its grip on the psychological milestone of 22,000. Fourteen out of the average’s 30 components finished lower.

Walt Disney Co. DIS, -3.88% was the biggest weight on blue chips, tumbling 3.9% a day after the media giant reported its quarterly results and announced plans to endits distribution deal with Netflix Inc. NFLX, -0.08%  and launch its own ESPN and Disney streaming services. Shares in streaming-giant Netflix, a major contributor to the overall market’s gains this year, fell 1.5%.

The S&P 500 index SPX, -0.04% SPX, -0.04% slipped 0.90 point, or less than 0.1%, to finish at 2,474.02, overcoming an earlier 13-point deficit. Of the 11 sectors on the S&P 500, only the utilities, consumer-discretionary, telecom and financial sectors finished in the red.

The Nasdaq Composite Index COMP, -0.28% closed down 18.13 points, or 0.3%, at 6,352.33, paring an earlier 61-point decline.

In the latest escalation of tensions between Washington and Pyongyang, the isolated Asian country threatened a missile strike at U.S. territory Guam. That saber-rattling came a day after U.S. President Donald Trump said he would respond with “fire and fury like the world has never seen” if the country doesn’t halt its threats.

Read more: How Trump’s threat of ‘fire and fury’ is rattling stock-market calm

Check out: Guam’s governor says ‘there is no threat’ but U.S. island ‘will be defended’

The heightened tensions come at a time when stocks have enjoyed a lengthy climb. The Dow recently rose for 10 straight sessions, a streak that ended on Tuesday, also halting an attempt at 10 successive closes in record territory. The S&P is also less than half a percentage point of its own record, with the Nasdaq about 1% off its own. 

“Definitely the primary reason stocks are down is geopolitical tensions,” said J.J. Kinahan, chief strategist at TD Ameritrade, in an interview. “But that’s coming off 10 days higher on the Dow and we’re still at highs. As much as we’d like to see the market go straight up, there’s got to be a day of reckoning.”

Recent market action has been slight, with small intraday moves and low volatility. On Monday, the S&P 500 moved in a range of just 0.2%, the third smallest range of the past 20 years, according to data from LPL Financial. 

Meanwhile, the CBOE Volatility index VIX, +1.37%  has been near all-time lows, though it rose less than one point on Wednesday, up 5.8% to 11.60. It had seen a steeper rise before paring its gains.

Even with the pullback, it’s amazing how calm markets are even with the alarming headlines, said Ryan Detrick, senior market strategist for LPL Financial, in an interview. So far, the S&P 500 has gone 15 sessions without a change of 0.3% or more, he said.

“We’re amazed at how calm things have been,” Detrick said. “We think it kind of comes down to: Below the headlines, we have a very strong global economy and strong global earnings. It’s not perfect but it’s expanding and improving.” 

Related: A problem for buy-the-dip investors: no dips to buy

Others saw silver linings in the prospect of a stock-market downturn.

“No one wants to see military escalation, but we think a pullback is healthy,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab.

Individual movers: Priceline Group Inc. PCLN, -6.94%  finished down 6.9%. The online-travel broker late Tuesday posted quarterly earnings that topped forecasts, but bookings missed expectations. TripAdvisor Inc. shares TRIP, +2.50% rose 2.5% even as the operator of travel websites reported weaker-than-expected quarterly results late Tuesday. 

A handful of defense contractors trended higher with the sabre-rattling. Shares of Raytheon Co. RTN, +2.57%  closed up 2.6%, while Rockwell Collins Inc. COL, +0.58%  shares rose 0.6%. L3 Technologies Inc. LLL, +1.99%  rose 2%, Lockheed Martin Corp. LMT, +0.23%  advanced 1.7%, Northrop Grumman Corp.NOC, +1.22%  was up 1.2%, and General Dynamics Corp. GD, +1.11%  ticked 1.1% higher.

Retailer Office Depot Inc. ODP, -25.86%  plummeted nearly 26% after it posted a quarterly profit that missed expectations

Drugmaker Mylan NV MYL, -0.90%  rose 0.9% after its results, while fast-food chain Wendy’s Co. WEN, +3.88% rose 3.8%. 

Economic news: Productivity or how many goods and services U.S. workers produce an hour rose at an annual rate of 0.9% in the second quarter from the prior three months, the Labor Department said Wednesday. This is up from a 0.1% rate in the first quarter.

Check out: MarketWatch’s Economic Calendar

On the Federal Reserve front, Chicago Fed President Charles Evans said he supported starting a reduction of the central bank’s $4.5 trillion balance sheet in September but was ambivalent about another rate hike this year.

Other markets: Gold futures GCQ7, +0.27%  rose 1.3% to settle at $1,279.30 an ounce as investors moved toward safety plays, with the Swiss francCHFUSD, +0.0311%  up 1.1%. European equities SXXP, -0.73% closed lower, following the lead of Asian markets, which finished lower. Oil futures CLU7, +0.16% settled up 0.8% at $49.56 a barrel after the latest inventory data showed a drop of 6.5 million barrels in the past week. 

The ICE U.S. Dollar Index DXY, -0.12% was slightly lower on the day.

—Victor Reklaitis in London contributed to this article.

Bitcoin to new record high, market cap hits $50 billion for first time

Bitcoin to new record high, market cap hits $50 billion for first time

Bitcoin surged above $3,000 to reach a new all-time high over the weekend, less than a week after a split that worried some investors.

Facebook exec paints a grim picture of where the U.S. will be in 30 years

Facebook exec paints a grim picture of where the U.S. will be in 30 years

The trendy notion among some of the world’s best and brightest: The robots are taking over. Tesla’s TSLA, +2.83%  Elon Musk is worried about it. So is Microsoft’s MSFT, +0.73%  Bill Gates. And professor Stephen Hawking, too.

More Time Spent On Instagram Vs Snapchat

More Time Spent On Instagram Vs Snapchat

Instagram says younger users spend an average of 32 minutes per day in the app.

Arista Networks beats Street 2Q forecasts

Arista Networks beats Street 2Q forecasts

SANTA CLARA, Calif. (AP) _ Arista Networks Inc. (ANET) on Thursday reported second-quarter earnings of $102.7 million.

Ubiquiti Networks Smashing Expectations, More Strength To Come

Ubiquiti Networks Smashing Expectations, More Strength To Come

The network hardware company easily exceeded its guidance with another record quarter.

Biotech Bear-Market Call Playing Out Well

Biotech Bear-Market Call Playing Out Well

Jon Hayes as most traders who are familiar with his trading style knows that he's betting a long short against $LABU and $XBI

Apple jumps 7% to record high after earnings beat estimates

Apple jumps 7% to record high after earnings beat estimates

Beat on earnings and revenue
Adjusted EPS: $1.67 per share vs. $1.57 per share expected by a Thomson Reuters consensus estimate
Revenue: $45.4 billion vs. $44.89 billion expected by a Thomson Reuters consensus estimate