TSX hits 1-month low on N. Korea tensions, lower oil prices

Paterniano Del Favero
Августа 13, 2017

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

Currency traders consolidated positions in the Japanese yen and Swiss franc, and pushed up the dollar index by unwinding some of the recent bets on the euro.

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

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 USD/CHF is down 0.20% and trading at 0.9718 Swiss Francs, off the session low of 0.97090 Swiss Francs.

Top automaker Hyundai Motor was up 1.39 percent to 146,000 won, and top steelmaker POSCO advanced 0.59 percent to 339,500 won. It ended the day at around 11, a daily gain of about 1.2.

The CBOE Volatility Index .VIX , better known as the VIX and the most widely-followed barometer of expected near-term stock market volatility, closed at 10.96, its highest in about a month.

Wall Street stocks fell Tuesday amid rising tensions between the United States and North Korea, bringing the Dow's streak of nine straight records to an end. The U.S. currency was down 0.3 percent at 109.94 yen, following a retreat to 109.740, its weakest since June 15.

South Korea's Kospi slid 1.1% to 2,368.39, while the Hang Seng Index in Hong Kong was 0.35% softer at 27,757.09.

Japan is the world's biggest creditor nation and there is an assumption Japanese investors may repatriate their foreign holdings in times of heightened global uncertainty. U.S. Treasury yields fell in Asian time and the 10-year benchmark yield is down 2.7 basis points at 2.26 percent.

The 30-year Treasury bond rose 40/32 in price to yield 2.8062 percent, from 2.867 percent late on Tuesday.

Pan American Silver Corp, which reported second-quarter results late Wednesday, rallied 10.7 percent to C$22.47.

Investors, who took the North Korea report from Japan in their stride earlier in the day, lost their appetite for risk after Trump's comments to reporters during his vacation at his golf club in New Jersey.

Economic docket: New York Federal Reserve President William Dudley said reaching the Fed's 2% inflation target this year is going to be tough (http://www.marketwatch.com/story/feds-dudley-says-2-inflation-target-will-remain-illusive-even-if-price-pressures-pick-up-2017-08-10) even if monthly data begins picking up.

Spot gold added 1 percent to $1,272.83 an ounce.

Prices did recover during early European trading, however, as Brent crude was last up 0.48% at $52.39 per barrel and West Texas Intermediate 0.49% higher at $49.41.

Across the Tasman Sea, New Zealand's S&P/NZX 50 added 0.2% to 7,799.64, led higher by local cargo giant Mainfreight, which was 1.8% firmer.

Copper lost 0.39 percent to $6,454.50 a tonne.

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