N Korean missile test rattles markets
US domestic politics also weighing on investor sentiment; turnover low at two billion units worth S$967 million
Add BT as a preferred source
A North Korean missile test on Tuesday brought geopolitical tensions to the fore and sent the Straits Times Index down 18.28 points to 3,249.34. At 5pm, the Dow futures had dropped 144 points, signalling a weak opening for Wall Street, while Europe opened in the red across the board.
According to news reports, North Korea fired a missile early on Tuesday that flew over Japan and landed in the Pacific about 1,180 km off Hokkaido. Japanese Prime Minister Shinzo Abe said it was "a most serious and grave" threat. Reuters described the test as one of the most provocative ever from the reclusive state and CNN reported that South Korea responded by conducting a bombing drill to test its "capability to destroy the North Korean leadership".
Most observers noted that safe havens all benefited from the spike in geopolitical worries. Rabobank's foreign exchange analyst Jane Foley noted that the location of the conflict and the parties involved make the euro, rather than the US dollar, the preferred safe haven currency of choice.
Copyright SPH Media. All rights reserved.
