NK Nuclear Tests Hurt Asian Stock Markets

Asia Pacific stock markets have endured another day of losses after North Korea said it had conducted a nuclear test, stoking geopolitical concerns in the region.

The Nikkei share average in Tokyo closed down more than 15 at its lowest point since October last year while the Kospi index in Seoul suffered steep falls over concerns about its northern neighbour’s nuclear capability. In Australia the ASX/S&P200 benchmark index was down 1%.

“North Korea woes added to investor fears and hit further the Japanese market, which was already battered by geopolitical worries about the Middle East and volatility in Chinese shares,” said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

The South Korean won also fell sharply on news about the nuclear test.

“We’ve been seeing dollar-long positions form from the beginning of the year and this North Korea news is not good for the market,” a Bank of Korea official told Reuters.

“However, when we consider previous cases we don’t feel this will have a sustained influence on markets,” he said. It was North Korea’s fourth nuclear test.

Despite falls elsewhere in the region, Chinese stocks edged up on Wednesday on hopes that regulators would extend a ban on share sales by major stakeholders as Beijing scrambled to avert a potential repeat of last summer’s market crash.

The CSI300 index of leading companies was up 1.5% in late afternoon trading.

State media reported the ban on some share sales, which had been due to expire on Friday, would remain in place until new rules to manage the process are promulgated.

via The Guardian

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