While you were sleeping: Stocks ease, bond prices rise as world events dominate

Stocks on Wall Street and US government bond yields slid as investors piled into haven assets in reaction largely to geopolitical events.

The Dow Jones Industrial Average eased just 6.65 points to 20651.37, with shares of financial and technology companies posting among the biggest losses.

The S&P 500 fell 0.1% to 2353.78 and the Nasdaq Composite lost 0.2% to 5866.77.

Geopolitical developments contributed to the risk-off mood, as Secretary of State Rex Tillerson made his first official trip to Moscow and South Korean officials sought to damp down concerns over the possibility of a pre-emptive US military strike on North Korea.

Stocks have wavered in recent sessions as details remain scarce on policy changes such as tax reform and infrastructure spending, giving investors few reasons to place fresh bets.

Shares of financial companies fell with bond yields, posting a 0.6% decline in the S&P 500. Morgan Stanley lost 1.2%, Bank of America fell 1.2% and BlackRock fell 0.9%.

Technology stocks slid, putting pressure on the tech-heavy Nasdaq. Dow component Apple shed 1.3% and Intel fell 0.6%.

Shares in United Continental, parent of United Airlines, closed 1.1% lower after earlier dropping 4%, or nearly $US1 billion, after a passenger was shown being physically dragged off a plane in a widely seen video.

Waiting for news
“The market’s just waiting for some positive news at this point – and we haven’t gotten it out of the Trump administration yet,” Crit Thomas, global market strategist at Touchstone Investments, says.

Safe haven assets gained, with government bonds and gold climbing.

The yield on the 10-year US Treasury note fell to 2.319% from 2.361% on Monday. Gold rose 1.5% to $US1272 an ounce, its highest level since early November and reflecting a price rise of 10% this year.

Elsewhere, the Stoxx Europe 600 fluctuated between small gains and losses before ending down less than 0.1%.

Selloff in France
Investors sold French assets after polls suggested the coming presidential elections, scheduled for April 23, could become a four-way race.

In Asia, Korea’s Kospi index slipped 0.4%, as tensions continued to build between North Korea and the US over Kim Jong Un’s nuclear weapons programme.

“The probability of escalation in North Korea is low, but if it happens, it can get very complicated very, very soon,” Salman Ahmed, chief investment strategist at Lombard Odier Investment Managers says.

The Japanese yen gained 1% against the US dollar. Japan’s Nikkei 225 index, made up of multinational stocks that suffer from a stronger yen, fell 0.3%.