Wall Street dipped on Monday, as a selloff in technology shares weighed heavily on the Nasdaq, while the most recent statement from North Korea's to Washington added to a cautious tone. North Korea's foreign minister said President Donald Trump had declared war on the country and it reserved the right to take countermeasures, including shooting down US bombers even if they are not in its airspace.
The White House disputed the declaration, calling the suggestion "absurd." The comments buoyed safe-haven assets, those that are favored by investors in times of crisis, with gold up 1 percent and the Japanese yen strengthened 0.26 percent versus the greenback at 111.71 per dollar. "The North Korea narrative is not going away and the longer it remains part of the conversation, the more negative it becomes," said Peter Kenny, senior market strategist at Global Markets Advisory Group, in New York.
The CBOE Volatility index, a widely followed measure of market anxiety, hit a 2-week high of 11.21 and was last up 0.63 points at 10.22. Tech names such as Facebook, off 4.5 percent, Microsoft, down 1.55 percent, and Apple, off 0.88 percent, were among the biggest drags on the benchmark S&P 500 index. Apple shares flirted with correction territory following a report that the company had told suppliers to scale back shipments of parts for its upcoming iPhone X.
"There has been some disappointment in the reception of Apple's latest iPhone release, and that is driving some concern and that is bleeding through to the supply-chain names," said Kenny. The S&P technology index slid 1.42 percent, its worst daily performance in five weeks. The index remains the best performing of the 11 major S&P sectors this year, however, with a rise of nearly 23 percent.
The losses in tech were offset somewhat by a sharp climb in the energy sector, which gained 1.47 percent. The sector notched its sixteenth gain in the last 18 sessions. Oil prices hit a more than two-year high after major producers said the global market was on its way towards rebalancing, while Turkey threatened to cut oil flows from Iraq's Kurdistan region toward its ports.
The Dow Jones Industrial Average fell 53.84 points, or 0.24 percent, to 22,295.75, the S&P 500 lost 5.56 points, or 0.22 percent, to 2,496.66 and the Nasdaq Composite dropped 56.33 points, or 0.88 percent, to 6,370.59. Genuine Parts shares jumped 5.96 percent as the best performer on the S&P 500 after the car parts distributor said it would enter the European market with a deal to buy peer Alliance Automotive Group for about $2 billion.
Allergan was up 3.40 percent after the drugmaker authorized a $2 billion buyback of its shares. Advancing issues outnumbered declining ones on the NYSE by a 1.28-to-1 ratio; on Nasdaq, a 1.26-to-1 ratio favored decliners. About 6.42 billion shares changed hands in US exchanges, above the 6.02 billion daily average over the last 20 sessions.
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