North Korea’s latest ballistic missile test over Japanese air space is throwing a chill over equity markets and is also pushing investors into safe haven options like gold and government bonds.
Not knowing what the North Koreans might do next has jittery market players nervous, as stock markets in the U.S. have been on a tear lately, and any truly bad news could result in worldwide market sell-offs.
European stocks look to close at their lowest levels since February, and both the TSX and the Dow were marginally lower earlier Tuesday morning.
In the meantime, gold is trading at 11-month highs at about $1320 per ounce and surprisingly, the Euro is gaining against the U.S. dollar as the safe haven currency because of America’s proximity to North Korea.
Analysts say that the market fear may be short lived, but because North Korea is so unpredictable, markets are vulnerable to surprises.