Economy

World markets slide for third day on political tension

World markets slide for third day on political tension

Japanese markets were closed for a holiday but the in-demand yen powered on, hitting an eight-week high of 108.91 yen to the dollar, adding to its biggest weekly gain since May.

After being undermined by strong USA data, gold reversed sharply to scale 8-week highs as tensions surrounding North Korea increased sharply.

The strength on Wall Street is partly due to bargain hunting, with traders picking up stocks at reduced levels following the pullback seen over the past few sessions.

A statement attributed to North Korea's head of strategic forces, General Kim Rak Gyom, said the plan for the strike would be ready by the middle of the month and would await orders from leader Kim Jong-un. Australia's S&P/ASX 200 edged down almost 0.1 percent to 5,760.90, while South Korea's Kospi fell 0.5 percent to 2,357.84.

Chinese bluechips lost 0.9 percent, while Hong Kong's Hang Seng was 1.6 percent lower.

Some investors are on edge after U.S. President Donald Trump warned North Korea of "fire and fury".

"It's been a bit of a roller coaster this week, with all the rhetoric between the U.S. and North Korea", said Jeff Kravetz, regional investment strategist at U.S. Bank Wealth Management.

"Tensions will continue to mount and could eventually develop into a "black swan" event that the markets are not prudently considering", Steve Hanke, professor of Applied Economics at the Johns Hopkins University, told the Reuters Global Markets Forum on Wednesday. The country previously threatened a further "all-out war, wiping out all the strongholds of enemies, including the USA mainland" in a government statement.

Sen. Sullivan: Congress won't allow an Executive strike against N. Korea
In national media interviews, Senator Dan Sullivan said Congress holds final authority when it comes to preemptive war strikes . On Tuesday, Trump said any additional threats from North Korea would be met with " fire and fury ".

The yen held steady against the dollar, taking a breather after having risen on Wednesday to its highest level in almost eight weeks.

United States stock futures were marginally softer on Friday.

The MSCI World index slipped 0.1 percent, extending Thursday's 1.1 percent drop, its biggest one-day slide since May 17, hurt by the escalating U.S.

The dollar widened losses against the yen to hit a two-month low.

The dollar held steady at 110.02 yen, having pulled up from Wednesday's low of 109.56 yen, its lowest level since June 15.

The Swiss and Japanese currencies are often sought in times of geopolitical tension partly because the countries have big current account surpluses.

Weakness in US Treasury yields may also be supporting the yen, some analysts said.

For now, the dollar remained on the back foot, pulling back 0.1 percent to 0.9635 Swiss francs on Friday, after dropping as much as 1.2 percent to a two-week low overnight.

Markets extend losses as Korea tensions escalate
The comments follow reports that the North has mastered a technology needed to strike the United States with a nuclear missile. Equity benchmarks in Germany and France on Wednesday fell by more than 1% each, marking their worst sessions since July 21.

The dollar index, which gauges the greenback against the currencies of six major USA trading partners, was last 0.2% down on the day during afternoon European trading hours - it stood at 93.20. July's 0.1 percent increase in consumer prices suggests that the Federal Reserve may be less likely to raise interest rates next month.

About 7.5 billion shares changed hands on US exchanges, well above the 6.25 billion average for the last 20 days.

United States gold futures for December delivery was mostly unchanged at $1,290.50 per ounce.

The 30-year bond US30YT=RR last rose 28/32 in price to yield 2.7759 percent, from 2.818 percent late on Wednesday.

Concluding with oil, WTI was last 1.0% down on the day, just above $48 a barrel, while Brent crude was 0.9% down, around $51.40 a barrel.

Palladium climbed 0.3% to $898.80 per ounce and was on track to end the week 2.3% higher. The Nasdaq Composite dropped 40.64 points, or 0.64 percent, to 6,311.70.

In the Dow, declines in shares of Merck and those of DuPont, recently down 0.9 per cent and 0.8 per cent respectively, outweighed gains in shares of Apple and those of Microsoft, recently up 1.3 per cent and 0.7 per cent respectively.

Southampton v Swansea City
Swansea, who finished in 15th past year , have also been dealing with their own want-away player this summer: Gylfi Sigurdsson . But Clement moved to calm fears over the Swans' transfer dealings and hinted that deals are already in the offing.


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