Because of the global political crisis investors have harbored in the safety arms of gold and yen for approximately five months. This has raised the yen and gold to five-month highs and has decreased the bond price to its lowest level.
The global political unrest has brightened outlook for global economic growth and has become a gain gate for some investors.
On the other hand, the rise of yen caused the most of the Japanese and Asia-Pacific firms damaged economically. As a result of rising yen’s increasing exporters’ shares Japan’s Nikkei downsized 1.2 percent.
MSCI’s broadest index of Asia-Pacific shares outside Japan has fallen down. Shanghai dropped 0.4 percent as China reported a slight slowdown in producer price inflation.
However, gold continued to rise to $1,277.29 and reached its highest level since last November.
Geopolitical tensions in the world continue. As the U.S. Navy strike group steamed toward the Korean peninsula North Korea warned the United States of a nuclear attack at any sign of aggression. It is known that Japan’s navy also plans joint drills with the U.S. force. Donald Trump sees North Korea a mischievous child to be disciplined with or without China. This tension and uncertainty has dragged South Korean stocks and caused jitters across Asia.
At the same time, the US blaming of Russia to support for Syria’s Bashar al-Assad raised the stakes in the Middle East.
The yen, a favored harbor in times of stress due to Japan’s position as the world’s largest creditor nation, climbed across the board.
Dollar was losing power day by day against yen. In Europe euro dropped to its lowest in five months at 116.02 yen. The political uncertainty in France also caused euro to lose weight.
Investors are seeking to transform political tensions into money and continue to bet on an upbeat earnings season. By the help of the positive expectations of the investors Wall Street’s losses were relatively minor. The Dow eased 0.03 percent, while the S&P 500 lost 0.14 percent and the Nasdaq 0.24 percent.
Saudi Arabia told OPEC officials it wants to continue OPEC cuts for an additional six months which gave an additional support to oil prices.