U.S. Stock Futures Dip After News on Health of North Korea’s Kim
(Bloomberg) -- U.S. stock index futures dropped after conflicting reports about North Korea’s Kim Jong Un’s health condition, after he underwent a medical procedure, and concerns over the energy market.
Contracts on the S&P 500 slid as much as 1.2%, before paring their loss to 0.6% as of 9:02 a.m. in London. Futures dropped 0.3% on the Nasdaq 100 Index and 1% on the Dow Jones Industrial Average. Europe’s Stoxx 600 traded 1.5% lower as oil and gas shares dragged on the benchmark.
The U.S. is seeking details about Kim’s health after receiving information that he was in critical condition after undergoing cardiovascular surgery last week, U.S. officials said. Meanwhile the South Korea President Moon Jae-in’s office said Kim was conducting “normal acitivities” in a rural part of the country.
With U.S. and South Korea giving differing accounts of the North Korean leader’s health condition, there’s a lingering mystery.
North Korean “succession risk is causing global equity markets to buckle,” Stephen Innes, chief global market strategist at AxiCorp, wrote in a research note. “But as we’ve seen countless times before a rise in geopolitical risk in the Korean Gulf is usually a faders paradise.”
The underlying S&P 500 halted a two-day gain on Monday and the Dow Jones Industrial Average fell more than 2%. Chevron Corp. and Exxon Mobil Corp. led losses in the blue-chip index as West Texas oil futures expiring Tuesday turned negative for the first time, primarily because the end of the May contract forces physical receipt at a time when storage capacity is low. June prices fell below $22 a barrel.
After the close of U.S. trading, International Business Machines Corp. reported a drop in first-quarter revenue and pulled its profit forecast for the year. Separately, President Donald Trump plans to sign an executive order temporarily suspending immigration into the United States as the country tries to contain the spread of the coronavirus.
(Updates prices throughout, adds South Korea’s statement,)
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April 21, 2020