Published: Sun, August 13, 2017
Money | By Armando Alvarado

North Korea has markets nervous but not panicked

North Korea has markets nervous but not panicked

USA stocks indexes were higher in afternoon trading on Friday, on track to snap a three-day losing streak, as tepid inflation data brought back investors to riskier assets, despite heightened tensions between the United States and North Korea. "You're less than 2 per cent off the high for the S&P heading into a weekend where uncertainty with North Korea still lingers".

A spokesman for the Korean People's Army said in a statement on Wednesday it was "carefully examining" plans for a missile attack on the U.S. Pacific territory of Guam, which has a large U.S. military base.

Gold prices held steady after touching their highest in over two months on Friday and were on track for a weekly gain, buoyed as rising tensions between the United States and North Korea triggered safe-haven buying. The Dow Jones Industrial Average fell 204.69 points, or 0.93 percent, to close at 21,844.01, the S&P 500 lost 35.81 points, or 1.45 percent, to 2,438.21 and the Nasdaq Composite dropped 135.46 points, or 2.13 percent, to 6,216.87. US gold futures gained 0.26 percent to $1,293.50 an ounce.

On the economic front, data is expected to show that US consumer prices likely rose in July after being unchanged the prior month.

Emerging market stocks lost 1.27 per cent. MSCI's broadest index of Asia-Pacific shares outside Japan closed 1.47 per cent lower.

He said the crisis provided a "perfect trigger" for a correction at a time when many markets - including the FTSE 100 - were at or around record highs, leaving them vulnerable to a sell-off if investors think it is time to take profits.

Asian Stocks Sink Most This Year on US-North Korea Rhetoric
Crude oil prices tumbled on the back of the selloff on Wall Street and lingering concerns over global oversupply. Spot gold added 0.4 percent to $1,265.18 an ounce, pulling away from the previous session's two-week lows.

France's CAC dropped 1.6% and Germany's DAX fell 1.3%. Shanghai's main index also tumbled 1.6 percent to 3,208.54 while Australia's S&P/ASX 200 dropped 1.2 percent to 5,693.10.

Instead, investors turned to the traditional safe-haven assets sought in troubled times, the Japanese yen strengthened 0.5 percent to 109.73 to the dollar JPY=. The USD/JPY pair was trading at 110.072 Yen, up 0.13%.

The dollar was further weighed down on Friday by the soft United States inflation data. The 1.3 percent gain for the market's main other choice for borrowing to fund speculation, the Swiss franc against the euro, is its biggest rise in more than a year.

"For now, the uptrend is very much intact in gold, reacting to external geopolitical events", said Jonathan Butler, commodities analyst at Mitsubishi in London.

Ongoing global glut concerns lingered in oil markets despite a bigger-than-expected draw in USA crude inventories, leaving prices volatile. Yesterday, the TICK opened at around 900-a reading of 1,000 or more means pretty severe selling pressure-and then headed higher throughout the day. Brent crude, used to price worldwide oils, gave up 22 cents to $51.92 in London.

Like this: