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August 27, 2013  Tue 7:10 AM CT

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Stocks are falling today on concerns about a potential war against Syria.

S&P 500 futures declined half a percent but have been trying to rebound from their lows of the session. Europe is down by more than 1 percent, and most Asian markets declined as well. The perceived risk is driving up precious metals and oil by more than 1 percent.

Equities were positive yesterday before Secretary of State John Kerry cited "undeniable" evidence that Damascus had used chemical weapons against rebels. The statement hints that the United States desires to escalate a conflict that's been contained for more than two years. It's the first political event to threaten the rally in stocks since worries about Cyprus in March.

The news comes with few major economic events or corporate earnings to affect sentiment. It also occurs before Labor Day, when volumes are light. In additional to the Syria news, Treasury Secretary Jack Lew signaled yesterday that the White House could play hardball with Congress over the national debt limit.

The S&P 500 had been showing signs of bouncing at a key support level from June but now seems to be hitting resistance at its 10-day moving average. If the index breaks last week's low of 1639, some chart watchers may expect a deeper correction toward 1600.

Foreign-exchange traders are in full risk-aversion mode, buying the safe-haven Japanese yen and U.S. dollar while dumping almost every other currency. Most agricultural commodities are lower, although copper is now trying to rebound from earlier losses. Gold continues to rally above the key 1400 level.

Today's economic events include the Case-Shiller Index of home prices at 9 a.m. ET and consumer confidence one hour later. The rest of the week is relatively light, but the calendar picks up starting next Tuesday with the Institute of Supply Management's key manufacturing index and monthly employment figures later in the week.

In company-specific news, retailer Tiffany is up 2 percent after earnings beat forecasts and management raised its guidance amid strong demand in China.
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