Ukraine tensions pull US stocks modestly lower

Specialist trader Michael Pistillo (second from left) gives a price for a stock just after the opening bell on the floor of the New York Stock Exchange on August 28, 2014. US stocks fell modestly on Thursday as rising fears about renewed tensions bet
Specialist trader Michael Pistillo (second from left) gives a price for a stock just after the opening bell on the floor of the New York Stock Exchange on August 28, 2014. US stocks fell modestly on Thursday as rising fears about renewed tensions between Ukraine and Russia outweighed a batch of encouraging US economic data. -- PHOTO: REUTERS

NEW YORK (AFP) - US stocks fell modestly Thursday as rising fears about renewed tensions between Ukraine and Russia outweighed a batch of encouraging US economic data.

The Dow Jones Industrial Average fell 42.44 points (0.25 per cent) to 17,079.57, while the tech-rich Nasdaq Composite dropped 11.93 (0.26 per cent) to 4,557.69.

The broad-market S&P 500 pulled back from Wednesday's record close, shedding 3.38 (0.17 per cent) at 1,996.74.

The indices finished off their lows of the morning, when shares were pressured by news that Russian forces were inside Ukraine helping support pro-Kremlin separatists who have been fighting against Kiev's rule since April.

Nato said at least 1,000 Russian troops were on the ground in Ukraine. Moscow insisted none of its soldiers were on Ukrainian soil.

Trading volumes were thin, with just 479 million shares changing hands at the NYSE floor, the lowest tally of the year, according to Briefing.com.

"The lack of activity reflected the preference to stick to the sidelines ahead of a three-day weekend that could bring new developments on the geopolitical front," it said.

The Ukraine tensions cast a cloud on positive economic news. The Commerce Department said the US economy expanded at a 4.2 per cent annual rate in the second quarter, revising upward its 4.0 per cent July estimate.

New claims for unemployment insurance benefits, a sign of the pace of layoffs, improved, and pending home sales climbed in July to their highest level in almost a year.

Dow component JPMorgan Chase dropped 0.7 per cent. The largest US bank by assets said it was cooperating with the FBI in an investigation of a cyber-attack against several US financial institutions.

Credit-card company Visa was the largest decliner on the Dow, falling 1.2 per cent.

GlaxoSmithKline gained 0.4 per cent on reports its Ebola vaccine is being fast-tracked for human trials.

Nasdaq heavyweight Apple edged up 0.1 per cent after sending out cryptic invitations to a Sept 9 event amid rumours the tech giant will unveil a new iPhone and perhaps a wearable device.

Dollar General rose 0.8 per cent after reporting fiscal second quarter sales trended higher. The deep-discount store chain also confirmed its commitment to buy Family Dollar, which rejected its US$9.7 billion (S$12 billion) offer last week. Family Dollar was flat.

Abercrombie & Fitch took a beating after the teen apparel chain reported second-quarter sales dropped six percent. Shares tanked 4.8 per cent.

Bond prices traded higher. The yield on the 10-year US Treasury slid to 2.34 per cent from 2.36 per cent Wednesday, while the 30-year fell to 3.08 per cent from 3.11 per cent. Bond prices and yields move inversely.