9-22-17 8:48 AM EDT | Email Article

By Sara Sjolin, MarketWatch

Apple slips and remains on track for worst week ahead of an iPhone launch

U.S. stock-index futures pointed to a lower open on Friday, as geopolitical tensions returned to the forefront after North Korea threatened to test a hydrogen bomb over the Pacific Ocean.

Traders were also looking ahead to a trio of Federal Reserve speakers, searching for more details on monetary policy after the central bank's meeting earlier this week.

Futures for the Dow Jones Industrial Average lost 27 points, or 0.1%, to 22,306, while S&P 500 index futures gave up 4.15 points, or 0.2%, to 2,496.75. Nasdaq-100 index futures fell 16 points, or 0.3%, to 5,928.75.

North Korea's foreign minister Ri Yong Ho said late Thursday at a United Nations meeting that his country might consider a nuclear bomb of "unprecedented scale" in the Pacific, although he said he did not know leader Kim Jong Un's exact thoughts.

Ri's comments came shortly after Kim released a statement threatening to make President Donald Trump "pay dearly" for his fiery speech to the U.N. on Tuesday, calling the U.S. leader a "mentally deranged U.S. dotard." (http://www.marketwatch.com/story/kim-jong-un-calls-trump-mentally-deranged-us-dotard-setting-off-scramble-for-dictionaries-2017-09-21)

The harsh comments came after Trump at a U.N. speech on Tuesday pledged to "totally destroy" North Korea if Pyongyang provoked the U.S. or its allies. Trump on Thursday ordered expanded sanctions against North Korea, targeting individuals or companies trading with the country.

"Trump's somewhat provocative language over North Korea at the U.N. this week (talk of 'destroying' another country is never great, really) were only ever likely to bring about the next step up in geopolitical tensions," said Richard Perry, market analyst at Hantec Markets, in a note.

"With geopolitical tensions rising again, haven assets are performing better, with the yen and gold rebounding, whilst Treasury yields have started to drop away again. Equities are also seeing some corrective pressure," he added.

The pullback for stocks comes at a time when equities have been broadly higher for an extended period. Major U.S. indexes have been trading near records, and with a modest dip on Thursday, the Dow ended a nine-day streak of gains (http://www.marketwatch.com/story/thatll-do-dow-the-averages-9-day-rally-is-overbut-still-historic-2017-09-21). Many investors could be looking for a reason to take profits, particularly with equity prices seen as stretched.

For the week, the Dow is up 0.4%, while the S&P 500 is flat. The Nasdaq is down 0.4%.

Asia markets closed mostly lower (http://www.marketwatch.com/story/asian-markets-rattled-by-latest-north-korean-nuclear-threat-2017-09-21) after the aggression from North Korea, while European wavered between small gains and losses (http://www.marketwatch.com/story/european-stocks-shaken-by-north-korea-but-strong-pmis-keep-losses-in-check-2017-09-22).

Gold prices were up 0.3%, while the yen rallied against the dollar . The greenback bought Yen111.98, down from Yen112.48 late Thursday in New York.

The ICE Dollar Index dropped 0.4% to 91.879, set to erase its weekly gain. The dollar gauge on Wednesday jumped the most since January, according to FactSet data, after the Federal Reserve hinted interest rates will rise again in December.

Oil prices were flat ahead of a meeting of the Organization of the Petroleum Exporting Countries and non-cartel members in Vienna where delegates will discuss the possibility of extending production cuts.

Read:Longtime laggers, an 'important turn is happening' in energy stocks (http://www.marketwatch.com/story/longtime-laggers-an-important-turn-is-happening-in-energy-stocks-2017-09-20)

Fed speakers: With the new signals from the central banks, traders are eager to hear from Fed speakers, including Kansas City President Esther George, who will deliver a keynote at an oil conference in Oklahoma City. Dallas Fed boss Robert Kaplan will participate in a Q&A at the same conference at 1:30 p.m.

In other economic news, the Markit manufacturing and services purchasing managers index for September is due at 9:45 a.m. Eastern.

Stock movers:Sprint Corp. (S) and T-Mobile US Inc. (TMUS) both rallied in premarket trading following a report (http://www.marketwatch.com/story/sprint-t-mobile-us-shares-jump-premarket-on-report-companies-are-close-to-merger-terms-2017-09-22) that the companies are close to agreeing on tentative terms on a merger agreement.

Shares of Versartis Inc.(VSAR) sank 83% ahead of the bell after the biopharmaceutical company late Thursday said its drug somavaratan failed to meet its primary endpoint in a phase 3 trial (http://www.marketwatch.com/story/versartis-shares-halted-2017-09-21).

Apple Inc.(AAPL) shares were down 0.5% in premarket trade. The stock is on track for the worst week ahead of an iPhone launch (http://www.marketwatch.com/story/apple-stock-on-track-for-worst-week-ahead-of-an-iphone-launch-2017-09-21) since the original iPhone was released back in 2007. The lackluster performance comes after less-than-stellar reviews on its new slate of product offerings.

 

(END) Dow Jones Newswires

September 22, 2017 08:48 ET (12:48 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.
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