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The jittery sentiment in US stock markets eased by the closing bell on Tuesday, but the rally in haven assets held as investors prepare for the start of earnings season and geopolitical risks swell.

The S&P 500 ended the day down 0.14 per cent at 2,353.8, representing a recovery from the fall of as much as 0.84 per cent earlier. The Dow Jones Industrial Average was little changed at 20,651.3, and the Nasdaq Composite declined 0.42 per cent to 5,866.8.

Despite the lukewarm close for equities, there was more vigourous action in other markets. Gold, seen as a shelter in times of tumult, climbed 1.4 per cent to $1,272.4 a troy ounce. Meanwhile, the benchmark 10-year Treasury yield, which moves in the opposite direction of the price, fell 6.3 basis points to 2.3 per cent.

In currencies, the yen soared 1.1 per cent against the US dollar. The dollar index, a measure of the greenback against six major currencies, slipped 0.3 per cent.

Corporate reporting season kicks off in earnest on Thursday, when JPMorgan Chase, Citigroup and Wells Fargo disclose their results. Wall Street is expecting profit growth to have picked up in the first quarter — something that will be critical given that the S&P 500′s forward valuation is running near the highest since 2004.

In addition to earnings, investors remain focused on global politics. US President Donald Trump on Tuesday reiterated that the US was willing to take action on North Korea, whether China is prepared to support it or not. The country also moved an aircraft carrier group near the Korean peninsula.

The more aggressive stance towards North Korea comes at a time when relations with Russia have frayed further after Mr Trump ordered a missile strike against Syria last week.

Copyright The Financial Times Limited 2017. All rights reserved.
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