Stephen Innes, Asia Pacific head of trading at Oanda said in a research note on Monday that the big question is how the international community will respond given how ineffective the tightened UN sanctions have been at discouraging North Korea’s nuclear programme.
Markets will also focus on whether China will unveil further restrictions on North Korea energy imports.
Demand for other safe haven assets was modestly higher, with the yen rising 0.5 per cent to 109.74 against the US dollar in early Monday action.
Regional equity market were also under pressure as investors sought to lower risk. The Hang Seng Index opened 0.3 per cent lower at 27,881.71, but held near a two-year high of 2,8127.90 that was hit last week.
Tokyo’s Nikkei 225 lost 0.9 per cent at 19.521.77 and South Korea’s Kospi dropped 0.8 per cent while Sydney’s All Ordinaries fell 0.4 per cent