Korea tensions cast long shadow over markets

Global uncertainty pushes gold

Korea tensions cast long shadow over markets

The London market endured heavy losses on Friday as America's stand-off with North Korea inspired another round of selling.

Saber rattling between the United States and North Korea sent financial markets in Europe and Asia lower on Wednesday as investors shifted their money into assets considered to be havens in times of trouble.

"We've had such a period of low volatility in the markets, coupled that with high valuation, it only takes a bit of a wobble to cause a reaction like we've seen", Jonathan Roy, advisory investment manager at Charles Hanover Investments, told Reuters.

The pound was down 0.1% against the euro at 1.10.

Japan's Nikkei had been down more than 1% overnight Tuesday and South Korean shares had also slipped.

The biggest fallers were Standard Life down 16p to 410.8p, Rio Tinto down 109.5p to 3,370p, Old Mutual down 6.2p to 195.3p, Anglo American down 39p to 1,238.5p.

Lanxess tumbled 3.30 percent.

Manufacturing production in June was flat, as predicted, after falling 0.1% in May, while United Kingdom construction output badly missed forecasts fell 0.1% month on month and rose 0.9% year-on-year. The steel giant backed its FY outlook after posting better-than-expected third-quarter results. BHP Billiton declined 2.87 percent and Glencore finished lower by 2.85 percent.

Beverage bottler Coca-Cola HBC surged 9.23 percent after posting solid first-half earnings. Oil prices veered lower as early gains faded. Barratt Developments fell 2.88 percent, Taylor Wimpey lost 2.98 percent and Persimmon shed 2.92 percent.

Insurer Aegon jumped 5.30 percent in Amsterdam after it agreed to sell its Irish business to Athene Holding for about €180m. Private payroll employment climbed 91,700 or 0.5 percent from the first quarter.

Biotech firm Galapagos surged 8.30 percent after announcing positive topline results with its autotaxin inhibitor GLPG1690 in patients with idiopathic pulmonary fibrosis in a mid-stage study.

In Paris, Total SA weakened by 1.81 percent and TechnipFMC surrendered 2.56 percent.

The FTSE 100 index was pulled down 0.6% to end at 7,498.06, putting an end to a four-session winning streak.

Separate ONS data showed that a pick-up in Britain's industrial output in June was marred by a slump in vehicle production, while construction output also fell. Industrial output expanded 0.5 percent on a monthly basis, after staying flat in May. "While tensions are running high, traders will be reluctant to be long". Trade in goods resulted in a shortfall of GBP 12.72 billion in June compared to GBP 11.31 billion deficit in May.

A report released by the Labor Department on Friday showed a modest uptick in consumer prices in the U.S.in the month of July. The Labor Department said its producer price index for final demand edged down by 0.1 percent in July after inching up by 0.1 percent in June.

METALS: Gold added $10.80, or 0.8 percent, to settle at $1,290.10 an ounce.

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