Investing.com – Wall Street traded lower Tuesday as investors remained nervous over geopolitical issues surrounding North Korea and digested some downbeat blue-chip earnings and economic data.
At 11:29AM ET (15:29GMT), the Dow Jones fell 82 points, or 0.40%, the S&P 500 lost 5 points, or 0.22%, while the Nasdaq Composite traded down 8 points, or 0.14%.
Tension surrounding North Korea has mounted over the past week as U.S. President Donald Trump has taken a tough rhetorical line with Pyongyang, dampening demand as risk-off sentiment takes hold.
U.S. Vice President Mike Pence visit to South Korea resulted in both countries’ pledge to forge a stronger alliance and cooperate with China to rein in North Korea, which has vowed to conduct more tests following Sunday's failed missile launch.
Pence warned North Korea on Monday that recent American military strikes in Syria and Afghanistan showed President Donald Trump's resolve should not be questioned.
Reports further suggested that the U.S. was considering shooting down further missile tests as the Pentagon looked for ways increase the pressure on North Korea, according to sources quoted by The Guardian.
Meanwhile, earnings out Tuesday from blue-chip firms did little to increase investor sentiment.
Goldman Sachs (NYSE:GS) and Johnson & Johnson (NYSE:JNJ) led the Dow lower with losses of 4.6% and 3.6%, respectively, after posting disappointing quarterly results.
The investment bank missed on both the top and bottom line on trading weakness, while the diversified healthcare firm saw sales miss consensus due to lower demand for its pharmaceuticals.
UnitedHealth (NYSE:UNH), however, managed to gain nearly 1% after a better than expected quarter convinced the U.S. largest health insurer to lift its guidance.
IBM (NYSE:IBM) was scheduled to release earnings Tuesday after the market close.
Economic news was also mostly downbeat on Tuesday as housing starts tumbled 6.8% in March, more than twice the expected 3.0% decline. On bright side, building permits managed to rise more than expected.
Although March industrial production advanced in line with estimates, manufacturing output unexpectedly dropped as production of automobiles sagged.
The dollar remained under pressure under the recent slew of weak data that also included retail sales and inflation.
The Atlanta and New York Federal Reserve banks downgraded their outlook for U.S. economic growth for the first quarter on Monday ahead of the advance reading for gross domestic product (GDP) on April 28, just days before the next monetary policy decision from the Federal Reserve (Fed).
Officials recently have been unfazed by the weak first quarter data, reiterating that gradual policy tightening was still appropriate.
Since Monday’s market close, both Fed vice chair Stanley Fischer and Kansas City Fed chief Esther George have indicated that the central bank would likely begin to normalize its $4.5 trillion balance sheet this year.
Meanwhile, oil prices continued to move lower on Tuesday in profit-taking sparked by a report ahead of the holidays that showed that U.S. drilling activity continued to be on the rise.
Oilfield services firm Baker Hughes reported last week that its U.S. rig count rose by 11 to 683. That was the thirteenth straight weekly increase to its highest level in nearly two years.
U.S. crude futures lost 0.38% to $52.45 by 11:30AM ET (15:30GMT), while Brent oil traded down 0.65% to $55.00.