European Stocks Torpedoed, Gold Pops as Investors React to Trump's 'Fire & Fury' North Korea Threat
Frankfurt (Aug 9) European stocks fell sharply across the board Wednesday as investors around the world piled cash into safe-haven assets amid increasingly dangerous rhetoric between North Korea and the United States.
The region-wide Stoxx Europe 600 index, the broadest measure of share prices, was marked 0.4% lower at 381.07, extending its three-month decline to around 3.7%. The SMI benchmark in Zurich was the biggest decliner in the region, falling 1.3% in the opening hour of trading as investors sought safety in the Swiss franc, which rose 1.12% against the euro and pushed the value of stocks which earn the bulk of their revenues in U.S. dollars lower.
Britain's FTSE 100 was marked 0.45% lower at 7,506 points, although gold mining companies Fresnillo Plc (FNLPF) and Randgold Resources (GOLD) posted solid 2.2% gains amid a $7 per ounce jump in bullion prices as investors moved money into safe-haven assets. Markets around the region, including Germany's DAX performance index and the CAC-40 in Paris, fell more than 0.8% in the first hour of trading.
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The U.S. dollar, which gained against both the euro and the pound in overnight Asia trading, trimmed its advance as investors moved into gold, the franc, U.S. Treasury bonds and the yen amid threats of an attack on the U.S. territory of Guam by North Korea after President Donald Trump told reporters Tuesday that "North Korea best not make any more threats to the United States" and that any aggression from Pyongyang would be met by "fire and fury like the world has never seen".
Officials in North Korea said they were "carefully examining" a strike on Guam, which is home to around 163,000 people and two U.S. military installations and threatened a further "all-out war wiping out all the strongholds of enemies, including the U.S. mainland" in a government statement.
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