Asian stocks traded mixed on Wednesday despite the reported North Korea’s testing of the most powerful ballistic missile, which outshined a rally in U.S. equities. The U.S. dollar was steady as U.S. tax cuts edged near to reality.
“The markets seem to be more immune than in the past to North Korea’s missile testing,” Asia economist at ING, Prakash Sakpal, said in a statement.
Tokyo and Sydney shares climbed while Hong Kong shares dipped after the S&P 500 Index rose one percent as the Senate budget committee developed the Republican tax bill, also lifting the dollar.
Seoul stocks gave up earlier gains as investors reflected the most recent intercontinental ballistic missile launch from North Korea. Bitcoin exceeded US$10,000 for the first time, making this year’s price increase of more than 10-fold.
“The crux of it is that people ascribe a very low likelihood of it developing into something more sinister,” said Mark Lister, head of private wealth research at Craigs Investment Partners in Wellington, which holds about US$7 billion.
“Markets are choosing to focus on the positives: that tax reform might be more likely, we’re still getting good corporate news, and all the economic data is ticking over pretty nicely.”
North Korea’s New Missile Launch
On Wednesday, North Korea launched a missile that landed in the Sea of Japan, according to a report. The launch, which is the country’s first launch since September 15, came after the United States considered North Korea as a country that supported terrorism on November 20.
After the launch, President Donald Trump assured the U.S. would ‘take care of” the situation. According to a report, Japanese Prime Minister Shinzo Abe and Trump have also agreed to reinforce their cooperation on the North Korea.
However, North Korea later bragged through local media that its new ICBM can reach the U.S. but the country said its weapons program would not threaten countries that did not intrude on the North’s sovereignty.
The Topic index added 0.7 percent as of 2.16pm in Tokyo and the Nikkei 225 Stock Average grew 0.4 percent. Hong Kong’s Hang Seng index dipped 0.2 percent and the Shanghai Composite Index slipped 0.6 percent.
Australia’s S&P/ASX 200 index increased 0.5 percent. The Kospi index traded flat. S&P 500 Index futures slipped less than 0.1 percent. The underlying gauge increased 1 percent.
The MSCI Asia Pacific Index jumped 0.1 percent.
The yen slightly changed at 111.52 per U.S. dollar. The Korean won increase 0.3 percent to 1,081.65 per U.S. dollar, ignoring the threat from North Korea. The markets are getting ready for a Bank of Korea rate decision on Thursday.
The euro traded at US$1.1851. The pound climbed 0.2 percent to US$1.3366. It was supported by the report of a positive result in negotiations over the UK’s departure from the European Union.
Bitcoin was at US$10,594.70.
The yield on 10-year Treasuries was slightly changed at 2.33 percent. The 10-year yield of Australia was down more than two basis points 2.47 percent.
West Texas Intermediate crude missed 0.5 percent to US$57.68 a barrel, a decline for a third day. U.S. industry data indicated crude supplies increased before OPEC meets to deliberate on extending supply cuts past the end of March. Gold increase 0.1 percent to US$1,295.77 an ounce.
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