Profit from North Korea crisis

[sakura]

 

The North Korean crisis has been preoccupying the minds of investors for a few months now. Back in April, North Korean leader Kim Jong-un ordered missiles to be fired over neighbouring Japan. The ensuing market instability prompted varied reactions from investors.

The risk averse headed for the safe haven markets, while others tried to capitalise on market volatility.

Today, the picture for investors has changed significantly.

As you read this (September 18) world stocks are at an all-time high. Investors have regained their appetite for trading in risky assets. Currency trading appears unaffected by events on the Korean Peninsula.

MARKETS BREATHE SIGH OF RELIEF

The markets have breathed a collective sigh of relief and for traders, with the risk of a nuclear war averted, North Korea has drifted to the back of their minds – for the time being.

The note of caution is sounded because it’s far from being a settled issue, and major powers are already drawn in.

On Sunday (September 17) US President Donald Trump appeared to mock Kim Jong-un.

“I spoke with President Moon of South Korea last night,” the US president wrote. “Asked him how Rocket Man is doing. Long gas lines forming in North Korea. Too bad!”

Despite the rhetoric employed by Trump and the US administration that “fire and fury” would be the US reaction to Kim Jong-un’s continued missile firing, their preference, so far, has been to see economic sanctions imposed on North Korea.

SANCTIONS SO FAR

The United Nations Security Council passed sanctions against North Korea. In turn, Kim Jong-un responded by firing another intermediate-range ballistic missile that flew over Japan and a promise that more tests were on the way.

These sanctions seem to be taking effect on the country, hence the reference to “Long gas lines”, if not Kim Jong-un himself.

A notable side effect to the crisis has been its effect on US/China relations which saw US Treasury Secretary Steve Mnuchin threaten a trade war with China if it didn’t uphold its sanctions against North Korea.

The markets would react with far more volatility if this were to transpire, and you can be sure investors will be paying special attention to US/China relations as the North Korean crisis unfolds.

 

For more detail : Profit from North Korea crisis