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| Tensions Between U.S. and North Korea Spur Global Stock Sell-Off | Tensions Between U.S. and North Korea Spur Global Stock Sell-Off |
| (about 2 hours later) | |
| LONDON — A sell-off in global markets accelerated on Friday as tensions between the United States and North Korea escalated, driving investors toward havens. | LONDON — A sell-off in global markets accelerated on Friday as tensions between the United States and North Korea escalated, driving investors toward havens. |
| Asian stock markets closed lower and European indexes opened sharply down on fears that the verbal back-and-forth between Washington and Pyongyang had raised the risk of actual conflict. | |
| Hong Kong’s benchmark Hang Seng Index fell 2 percent, and South Korea’s main share index also dropped. Stock markets in Britain, France and Germany were all lower by noon in London. | Hong Kong’s benchmark Hang Seng Index fell 2 percent, and South Korea’s main share index also dropped. Stock markets in Britain, France and Germany were all lower by noon in London. |
| Investors moved their money into what they apparently deemed safer assets. The Japanese yen and Swiss franc were both stronger, and the price of gold rose for the third consecutive day. The yields on British and European bonds, which move inversely to the price, fell. | |
| The jitters in the stock markets followed tougher talk from Washington and Pyongyang. President Trump said on Thursday that his warning about the United States potentially hitting North Korea with “fire and fury” may not have been tough enough, after North Korea responded by threatening to launch a missile strike at Guam, an American territory in the Pacific. | The jitters in the stock markets followed tougher talk from Washington and Pyongyang. President Trump said on Thursday that his warning about the United States potentially hitting North Korea with “fire and fury” may not have been tough enough, after North Korea responded by threatening to launch a missile strike at Guam, an American territory in the Pacific. |
| “Despite attempts by some U.S. officials to calm sentiment, fears of escalating military tension between North Korea and the U.S. are dominating market attention,” Dirk Willer, the head of emerging markets strategy at Citigroup, said in a research note on Friday. | “Despite attempts by some U.S. officials to calm sentiment, fears of escalating military tension between North Korea and the U.S. are dominating market attention,” Dirk Willer, the head of emerging markets strategy at Citigroup, said in a research note on Friday. |
| Still, Mr. Willer said, “thus far, the market response has been modest.” | Still, Mr. Willer said, “thus far, the market response has been modest.” |
| The reaction, he said, reflected investors’ experience “that geopolitical rhetoric can quieten as quickly as it escalates” and a belief that “the true risk of military confrontation is minimal.” | The reaction, he said, reflected investors’ experience “that geopolitical rhetoric can quieten as quickly as it escalates” and a belief that “the true risk of military confrontation is minimal.” |
| Concern in the markets was a shift from the general upswing in stocks during the Trump administration. Despite the geopolitical uncertainty and tumult in the White House, American stocks had been reaching new highs, driven by strong corporate profits and optimistic executives. | Concern in the markets was a shift from the general upswing in stocks during the Trump administration. Despite the geopolitical uncertainty and tumult in the White House, American stocks had been reaching new highs, driven by strong corporate profits and optimistic executives. |
| The VIX, Wall Street’s so-called fear gauge, which measures expectations of volatility in stock markets, had held at uncharacteristically low levels for much of the year. It began to rise sharply this week. | The VIX, Wall Street’s so-called fear gauge, which measures expectations of volatility in stock markets, had held at uncharacteristically low levels for much of the year. It began to rise sharply this week. |