LONDON — Stocks around Europe, and in the broader global markets, are falling on Tuesday morning as investors react to the latest provocation from the North Korean regime.
North Korea launched a missile that flew over the northern Japanese island of Hokkaido at 5:58 a.m. local time on Tuesday, according to Japanese government officials.
Japan’s NHK News reported that the missile passed over Japan, warning people in northern Japan to take necessary precautions.
The move is the latest in a series of missile launches and grandstanding statements from the far-east state in recent months, as tensions between its ruler Kim Jong-Un and the West rise.
As noted by analysts from Nomura in a note circulated early on Tuesday morning, the “number of North Korean provocations this year has already exceeded last year’s figure,” and is higher than in any year in the last two decades.
Earlier in August, US President Donald Trump warned that any provocations from the country would “be met with fire and fury like the world has never seen.”
As a result of the latest development in the growing tensions, European markets are dipping, with the majority of the continent’s major bourses losing in excess of 1% during the first half an hour of trading.
In Britain, the FTSE 100 — which returns to trading on Tuesday after a long Bank Holiday weekend — has dropped 1.1% to trade at 7,320 points, as of 8.25 a.m. BST (3.25 a.m. ET). Losses across the index are widespread, with just a handful of companies, including gold miners Fresnillo and Randgold Resources, gaining ground.
The story across the continent is largely the same, with indexes across the channel also down more than 1%, as the table below illustrates:
“Calls for a negative start in Europe come after North Korea took its provocation to a 20-year high by firing a ballistic missile over Japan into the Pacific ocean, undermining US attempts to bring Kim Jong-un to the negotiating table,” Mike van Dulken of Accendo Markets wrote in an email.
“This has understandably seen an overnight preference for safe havens such as Gold, the Swiss Franc, Japanese Yen and Bonds, at the expense of equities with Asian bourses which are firmly in the red,” he added.
Overnight, US stock futures slumped after the missile launch was reported, while Asian equities also dropped sharply.