The Japanese yen, gold and sovereign bonds all rise - and European shares fall - as North Korea's latest nuclear test, and reports Pyongyang was making preparations for another missile launch, provoke a knee-jerk shift to safer harbours. David Pollard reports.
The familiar face of what many regard as a rogue state ... After news of another nuclear test - the North Korean leader apparently seen inspecting a hydrogen bomb. Markets, unsurprisingly, shifting to safe haven assets. (SOUNDBITE) (English) THINK MARKETS, CHIEF MARKET ANALYST, NAEEM ASLAM, SAYING: "There's a knee jerk reaction which we're seeing in the market today and that's what's pushed the price for gold higher and all the safe havens currencies are back in play. The safe haven trade is across the floor. But I think the major fundamental would be back in focus if there is no further escalation from there onwards." The risk off mood still knocked nearly a per cent off the Nikkei. South Korean stocks down by a similar amount. The gainers: gold - which spiked to a 10-month peak- and the yen. European shares too taking a knock - bourses across the continent in the red after opening. (SOUNDBITE) (German) HEAD OF CAPITAL MARKET ANALYSIS AT BAADER BANK, ROBERT HALVER, SAYING: "The Dax is in a subdued mood. We know that having tested successfully the H-bomb, they might even go further. And if Russia and China, cannot rein in the country then who can? And that is also a problem for a U.S. president." But as Trump and other world leaders queued up to condemn North Korea ... Some traders say markets have already seen such tensions many times. Some others say they could be rather too casual over a growing threat level. As South Korea takes steps to test its own defences. Familiarity breeding not so much contempt - as deeper concern.