ibusinesslines.com
ibusinesslines.com July 21, 2018


FTSE 100 takes cover from war of words over South Korea

13 August 2017, 05:52 | Erica Roy

Equity screens were also awash with red in Asia as investors fled to safe haven assets after US President Donald Trump doubled down on his North Korea rhetoric.

European stock markets fell further in opening trade on Friday on intensifying fears over North Korea, dealers said.

But for now it seems that "traders still believe the prospect of military action is very small but precautions are still being taken nonetheless, as this still has the potential to escalate very quickly and unexpectedly", he said.

The FTSE 100 index UKX, -1.04% slumped 0.8% to 7,332.52.

In the eurozone, the Paris CAC 40 dropped nearly 0.7 percent to 5,081.92 points compared with the closing level on Thursday. The index, which hovered below record highs this week, has slipped more than 3 per cent since Mr Trump said on Tuesday that the United States would unleash "fire and fury" if Pyongyang continued to issue threats. Its rouble-based peer MICEX shed 1.2 percent to 1,937 points, its lowest since August 1.


"While it appears that Pyongyang's detailed strike plan against Guam has created a sour backdrop to trading, it's worth noting that US/North Korea tensions aren't having quite the same effect on the DAX and CAC", said Spreadex analyst Connor Campbell.

Yields on low-risk German government bonds dropped to their lowest in three weeks after further declines in U.S. Treasury yields and gold is holding at more than two-month highs.

The stock market jitters came as North Korea outlined plans to launch missiles aimed at the waters off the coast of the US Pacific territory of Guam.

The FTSE 100 is clearly in a slump, brought on in part by the tensions between the USA and North Korea, which could eventually culminate in nuclear war.

On commodities markets, oil advanced initially after figures from the American Petroleum Institute showed a sharp decrease in stockpiles.



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