Dollar, others slump over North Korea’s nuclear crisis

Dollar, others slump over North Korea’s nuclear crisis

The US Dollar slumped to its lowest close for almost three months Wednesday, leading an Asia-wide sell-off sparked by President Donald Trump’s apocalyptic warning over North Korea’s weapons programme.

Escalating tensions around Pyongyang’s nuclear ambitions sent a shiver through markets worldwide and pushed the dollar to below 109.7 yen in afternoon forex trade to an eight-week low against the safe haven currency, piling more pressure on Japanese stocks.

Tensions spiked yet further when North Korean state media later said Pyongyang was considering strikes near US military installations in Guam.

Tokyo’s blue-chip index tumbled 1.3 percent to its lowest close since late May after the Dow’s winning streak of nine straight records ended following Trump’s sharp rhetoric of “fire and fury”, with the main European bourses also opening lower Wednesday.

Hong Kong and Shanghai followed Tokyo into the red, as China factory gate inflation came in slightly below forecast amid warnings from experts of a further slowdown in the world’s second-largest economy.

Stocks ended more than one percent down in Seoul while the won slumped to a three-week low against the dollar as the US president and South Korea’s volatile neighbour dramatically ramped up their war of words.

But analysts said equities had also fallen as investors took profits.“North Korea is being used as a reason to sell Japanese stocks, just as it was used yesterday in the US,” said Soichiro Monji from Daiwa SB Investments in Tokyo.

US equities had been on track for a 10th-straight record session Tuesday and the dollar was initially up after the JOLTS survey showed job openings hit a record in the US last month.

Greg McKenna, an analyst at AxiTrader, said the data could bolster the Federal Reserve’s plan to start winding in its multi-trillion-dollar bond holdings balance sheet, expected to be announced next month.

The positive data also bolstered the greenback against the euro and the pound Wednesday.

Sydney was a rare bright spot in Asia-Pacific with stocks closing 0.4 percent up as Australia’s biggest bank posted record annual profits.

The Commonwealth Bank of Australia’s profits are closely watched and the results provide a guidance on the health of the country’s economy as it transitions away from a dependence on mining.

In commodities trading, US crude oil was wallowing around $49 to the barrel amid speculation that a predicted gain in American output will offset OPEC-led efforts to trim a global glut.

Nigerian Online Newspaper=


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