Asia report: Markets mixed as North Korea tensions tighten

Women walk past an electronic stock board showing indexes of Japan’s Nikkei 225 top right and other countries at a securities firm in Tokyo.- AP

Women walk past an electronic stock board showing indexes of Japan’s Nikkei 225 top right and other countries at a securities firm in Tokyo.- AP

Both the Swiss franc and the yen have climbed against the dollar this week, after U.S. President Donald Trump warned North Korea that it would face "fire and fury" if it threatened the United States.

The local currency was trading at 1,135.20 won against the USA dollar, down 10.10 won from the previous session's close.

All three major equity benchmarks finished sharply lower on Thursday for their worst day since mid-May, with the trifecta of indexes all tumbling for a third straight session for the first time since mid-April, amid a persistent war of words between the USA and North Korea.

The rhetoric between the US and North Korea has continued to heat up, leading traders to look to safe havens such as gold and treasuries. It outlined detailed plans for a missile strike near USA territory Guam.

Top automaker Hyundai Motor was up 1.39 percent to 146,000 won, and top steelmaker POSCO advanced 0.59 percent to 339,500 won.

Meanwhile, gold stocks are bucking the downtrend, driving the NYSE Arca Gold Bugs Index up by 1.2 percent. The U.S. currency was down 0.4 percent at 109.865 yen, following a retreat to 109.835, its weakest since mid-June.

Witnesses describe chaos, panic as vehicle plows into Charlottesville crowd
Very soon after a shooting at an Orlando nightclub in June 2016, Trump tweeted that he was "right on radical Islamic terrorism". David Duke, a former "grand wizard" of the Ku Klux Klan white power group, also called the event "a turning point".

The overall financials group, which accounts for roughly a third of the index, declined 1.4 percent, while energy shares also fell 1.4 percent as oil prices turned down.

"North Korea is being used as a reason to sell Japanese stocks, just as it was used yesterday in the U.S.", said Soichiro Monji from Daiwa SB Investments in Tokyo. While the French CAC 40 Index fell by 0.6 percent, the German DAX Index slumped by 1.1 percent and the U.K.'s FTSE 100 Index plunged by 1.4 percent.

Japan is the world's biggest creditor nation and there is an assumption Japanese investors may repatriate their foreign holdings in times of heightened global uncertainty. The Korean won fell against the USA dollar.

Switzerland's franc on Wednesday posted its biggest single-day rise against the euro since the central bank removed its cap on the currency in January 2015. The euro slid to $1.1752 from $1.1793.

The 30-year Treasury bond rose 40/32 in price to yield 2.8062 percent, from 2.867 percent late on Tuesday.

Trump's top security adviser H.R. McMaster earlier told MSNBC that the U.S.is preparing for a "preventive war" with North Korea among other options on the table to deal with Pyongyang's nuclear and missile threats.

DJIA Today: Dow Jones Futures Down Triple Digits on North Korea Fears
The reclusive state raised the stakes further with a detailed plan to send a salvo of missiles towards the U.S. territory of Guam. Falling crude prices made oil and gas stocks a weight too, dropping 1 percent with Tullow Oil PLC leading the decline.

Trump's comment pushed Wall Street lower, with only utilities making gains, and drove the VIX "fear gauge" of expected volatility on the S&P 500 to its highest in nearly a month.

As reported at 10:55 am (JST) in Tokyo, the USD/JPY was trading at 109.823 Yen, down 0.45%; the pair earlier hit a trough of 109.793 Yen, while the session peak stands at 110.386 Yen.

Ralph Lauren gained $10.38, or 13.3 percent, to $88.53, while peer-to-peer loan company LendingClub added 99 cents, or 18.1 percent, to $6.45.

Gold fell $2.10 to $1,262.60 an ounce.

Copper lost 0.39 percent to $6,454.50 a tonne.

Markets Right Now: Stocks drop, led by technology companies
After an hour of trading, the FTSE was down 46.18 or 0.6% to 7,451.88, with the FTSE 250 down 0.1% to just over 19,854. The market indexes wavered between small gains and losses for much of the morning, then veered lower by afternoon.

Recommended News

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.