The North Korean nuclear crisis returned to the forefront of investors’ minds this Wednesday, with yesterday’s Dow Jones-plunge and a jittery Asian session overnight leading the European indices into the red.
South Korea’s president Moon Jae-in stated that the situation was becoming ‘uncontrollable’, while North Korea’s UN ambassador Han Tae Song claimed the US can expect to receive more nuclear test ‘gift packages’. Add onto this the threat of Hurricane Irma, currently in the Caribbean and heading towards Florida, and there was little reason for market-cheer.
The FTSE was up there with the worst performers, falling half a percent largely thanks to the weight of its commodity stocks. There was also drag from the housing sector, with Barratt Developments (LON:BDEV) dropping 4% despite posting record annual profit, better than forecast revenue and a 39% hike to its dividend. That the company has climbed so high in recent months is partially responsible for this correction, as is the prospect of only ‘modest growth’ in its next financial year.
Over in the eurozone trading was similarly sour, with the DAX and CAC slipping 0.3% and 0.4% respectively. The former was also dealing with some German-specific bad news, as the country’s factory orders plunged from 0.9% to -0.7% month-on-month.
As for the forex markets, things were pretty flat. Sterling gave back a chunk of yesterday’s growth, falling 0.1% against the dollar and 0.2% against the euro, while the latter currency was flat against the greenback.
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