Stock Futures Slip on North Korea Nuclear Threats
Dow Jones Industrial Average (DJIA) futures are pointed lower this morning, after the index snapped its seven-session run of record closes and nine-day win streak Thursday. Traders are digestinganother nuclear bomb threat from North Korea, as Kim Jong Un warned of the "highest level of hard-line countermeasure in history," following President Trump's threats to "totally destroy" the country if provoked. In addition, Kim vowed to "tame the mentally deranged U.S. dotard with fire," and the isolated country's next nuclear test could include a hydrogen bomb into the Pacific Ocean, according to North Korea's foreign minister. Futures on the S&P 500 Index (SPX) and Nasdaq-100 Index (NDX) are also signaling a lower start as a result.
Plus, a trio of Fed speeches are scheduled today, with San Francisco Fed President John Williams, Kansas City Fed President Esther George, and Dallas Fed President Robert Kaplan set to deliver remarks. On Wednesday, the central bank announced plans to begin unwinding its massive balance sheet, and hinted at a December rate hike.
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The Chicago Board Options Exchange (CBOE) saw 781,621 call contracts traded on Thursday, compared to 518,848 put contracts. The single-session equity put/call ratio rose to 0.66, and the 21-day moving average remained at 0.61.Versartis Inc (NASDAQ:VSAR) stock is down 85% in pre-market trading -- headed for a record low in the single digits -- after the company's pediatric growth hormone proficiency drug failed to meet its primary endpoint in a late-stage study. As a result, no fewer than three brokerage firms downgraded the drug stock, including Barclays, which cut its rating to "underweight" from "overweight" and sliced its price target to $4 from $28.Shares of Sprint Corp (NYSE:S) are up 4% in electronic trading, on reports that the wireless communications company is close to agreeing on merger terms with T-Mobile. T-Mobile US Inc (NASDAQ:TMUS) stock is also climbing as a result, last seen up 1.5% before the bell.
Worse-than-expected second-quarter sales have Finish Line Inc (NASDAQ:FINL) stock down 7.7% before the open -- in line with options traders' expectations. The shoe retailer also lowered its fiscal-year outlook for 2018. The Baker-Hughes weekly rig count and Markit's flash composite purchasing managers index (PMI) will hit the Street today, ahead of next week's highly anticipated speech from Fed Chair Janet Yellen. CarMax (KMX) is on the earnings list.
Overseas Trading
A new threat from North Korea about a possible hydrogen bomb test and yesterday's downgrade of China's credit rating weighed on Asian markets today. As investors fled to safe-haven assets -- including the yen -- Japan's Nikkei fell 0.3%. Elsewhere in the region, Hong Kong's Hang Seng gave back 0.8%, South Korea's Kospi closed down 0.7%, and China's Shanghai Composite shed 0.2%.
European stocks are holding on to modest gains at midday, after the IHS Markit's flash purchasing managers index (PMI) for the eurozone came in higher than expected in September, thanks to a big boost in manufacturing activity. PMI data for France and Germany was also upbeat, with both readings arriving at six-year highs. At last check, the French CAC 40 is up 0.2%, while German's DAX is 0.01% higher ahead of the country's general elections on Sunday. U.K.'s FTSE 100 has tacked on 0.08% before a Brexit update from Prime Minister Theresa May, slated for 2:15 p.m. London time.