Investing.com - Here are the top five things you need to know in financial markets on Monday, September 4:
1. North Korea conducts another nuclear test
North Korea conducted its sixth and most powerful nuclear test to date on Sunday, which it said was a successful detonation of an advanced hydrogen bomb, in a dramatic escalation of the isolated state's stand-off with the U.S. and its allies.
In response, U.S. President Donald Trump refused to rule out military action and threatened to cut off trade with any country doing business with the reclusive state. The move, if implemented, would likely affect China, North Korea's most important trading partner.
The United Nations Security Council is poised to hold an emergency meeting later today to discuss its response.
South Korea’s Defense Ministry said earlier that Pyongyang is making preparations for the possible launch of another intercontinental ballistic missile, but didn’t say what the signs of activity were, or give a time frame for a possible launch.
Many experts have been preparing for a weapons test around September 9, when North Korea marks the anniversary of its foundation in 1948.
2. Global stocks rattled by latest North Korea missile test
Global stock markets stumbled in risk-off trade, after the latest act of provocation by Pyongyang ramped up global tensions.
Stock markets across Asia ended lower, with benchmarks in Tokyo and Seoul falling sharply.
In Europe, shares slumped around 0.5%, with almost all major bourses across the region in negative territory.
Meanwhile, U.S. stock futures dipped around 0.4%, though Wall Street will be closed for the Labor Day holiday.
3. Gold jumps to 1-year high as investors pile into safe-havens
Gold, the Japanese yen and sovereign bonds all rose, as North Korea's latest nuclear test provoked the usual knee-jerk shift to safe-havens.
Prices of the yellow metal jumped around 1% to $1,341.84 a troy ounce, after touching its best level since Sept. 27 at $1,344.60 earlier.
Meanwhile, the dollar was at 108.50 against the yen, down 0.7% from late U.S. trade on Friday. The greenback was also lower against the Swiss franc, with USD/CHF falling almost 1% to 0.9560.
Investors also rushed to the safety of global bonds, pushing down yields around the world.
4. Oil slips, gasoline pulls back as refineries restart after Harvey
Oil prices struggled, while gasoline futures slumped on signs that the damage from storm system Harvey to the Gulf coast energy infrastructure was not as bad as initially feared.
U.S. crude was at $47.30 a barrel, little changed on that day, while global benchmark Brent lost roughly 1% to $52.24.
Meanwhile, gasoline futures, which surged to a two-year peak of $2.139 late last week on fears of supply shortages, sank 4% to $1.673 a gallon.
About 5.5% of the U.S. Gulf of Mexico's oil production remained shut on Sunday, the federal Bureau of Safety and Environmental Enforcement said, down sharply from a peak of around 25% shortly after Harvey made landfall more than a week ago.
Meanwhile, two key fuel pipelines were set to start up later in the day, helping alleviate concerns about rising retail prices and the domestic distribution of gasoline and distillates.
5. Bitcoin, other cryptos tumble after China bans ICOs
Bitcoin and other leading cryptocurrencies tumbled, after China banned individuals and organizations from raising funds through initial coin offerings, saying the practice constituted illegal fundraising.
Bitcoin dropped to $4,322.30, down $272.70, or around 6%. The digital currency rallied to an all-time high of $4,911.80 over the weekend.
Ethereum, Bitcoin's closest rival in terms of market cap, sank 12%, or $42.70, to $308.50. It briefly rose to a record peak of $394.78 on Saturday.
Other prominent cryptocurrencies such as Litecoin, Ripple and Dash also traded sharply lower.
The total value of all publicly traded cryptocurrencies was $150 billion, a figure that was down more than 16% from a high of nearly $180 billion reached on Saturday night.