"The market's also taking a bit of view on what the U.S. Federal Reserve will do next". Thus, unless the unthinkable happens and North Korea and the USA start an actual war, I wouldn't be surprised if stocks were to come back again.
CNBC, using hedge fund analytics tool Kensho, looked at what happened to financial markets after the last five times North Korea conducted a nuclear weapons test, beginning with its first test in 2006. "Furthermore, US President Donald Trump's pledge to stop doing business with any country that still has relations with North Korea could have severe financial implications, as it would mean possibly no trade with China, India, Mexico and France to name a few".
Today the Chinese administration branded the comments "unacceptable" and "unfair". The protection can be a combination of options or safe haven plays like gold and silver. Woodside Petroleum is adding 0.3 percent, Oil Search is advancing nearly 1 percent and Santos is rising nearly 2 percent.
And the CBOE Volatility Index tends to surge, history shows.
The benchmark Nikkei 225 index fell 0.31 percent, or 59.94 points, to 19,325.87 by the break - a four-month low - while the broader Topix index was down 0.20 percent, or 3.20 points, at 1,587.51. The main driver of this positive adjustment was the optimism among investors about the future economic developments in the region, with the sub-index which captures expectations for the next semester rising by 1.3 points to 17.3.
The Australian dollar fell to trade at $0.7998 from levels around $0.8017 after the release of GDP data.
Investors will closely watch European Central Bank policy makers who gather on Thursday and are set to discuss the future of the central bank's bond-buying program. "The ECB is now expected to wait until October to announce the future of its asset purchases program.", said the analyst. We now expect gold prices to average US$1265/oz and US$1300/oz in 3Q17 and 4Q17 respectively (+3% and +7% above previous forecasts) and US$1261/oz in CY18 (+3%) (Figure 3, Table 1). The UK Parliament is set to debate an European Union repeal bill on Thursday. This was particularly due to an investment downturn in the commercial sector. The market close on Tuesday represented the steepest fall for each gauge since August 17, when the markets were processing news of a terrorist attack in Barcelona and the dissolution of two of President Trump's business advisory councils.
Canada's central bank will also be on the radar ahead of its interest rate decision on Wednesday U.S. time.
Overnight, gold prices fell on Wednesday, as USA political uncertainty eased after President Donald Trump agreed to raise the debt ceiling and extend government funding through December 15.
Toy companies Hasbro and Mattel lost 2.9 percent and 1.6 percent, respectively, after Danish toy giant Lego announced it would slash 8 percent of its global workforce after a drop in sales in the U.S. and Europe.