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London - Stocks slumped across Europe and Asia and havens including gold jumped after North Korea fired a ballistic missile over Japan, rattling markets from London to Sydney.
Gasoline slipped even as energy companies braced for another hit from Tropical Storm Harvey.
As equities retreated, volatility rose and bonds gained in classic risk-off moves. US stock futures also tumbled, Treasuries jumped and the dollar weakened.
Gold surged to the highest this year, while the Swiss franc and the yen were the best-performing major currencies.
The euro climbed above $1.20 for the first time since 2015, adding yet another headwind for the region’s stocks.
Gasoline reversed an increase after five days rising, even as Harvey picked up strength again after inundating refineries along the Texas coast.
Japan called Kim Jong Un’s latest provocation an "unprecedented, grave and serious threat," and asked the United Nations Security Council to hold an emergency meeting.
The missile seems likely to reignite the simmering tension between North Korea and the US just days after Secretary of State Rex Tillerson praised the nation for its "restraint."
"Some observers had thought the US and North Korea were pursuing discussions behind closed doors, but it turns out North Korea continues to pursue missile development," said Chihiro Ohta, a Tokyo-based senior strategist at SMBC Nikko Securities.
"The risk-off stance is likely to continue even if the US responds calmly."
Among other key events looming this week:
The US Conference Board releases its monthly consumer confidence index for August. Inflation data from the eurozone’s largest economies this week may show prices nudged up in August. Japan releases figures for the industry on Wednesday.
Australia is due to publish data on Wednesday detailing construction work done. The US updates second-quarter GDP and core price data on Wednesday, and reports on August payrolls on Friday.
And here are the main moves in markets:
Stocks
The Stoxx Europe 600 Index dipped 1.3% as of 7:17am in New York, the lowest in almost seven months. The UK's FTSE 100 Index declined 1.1% on the biggest drop in almost three weeks on a closing basis.
Germany’s DAX Index dipped 1.7% to the lowest in more than five months. Futures on the S&P 500 Index fell 0.6% on the biggest fall in more than a week.
Currencies
The Bloomberg Dollar Spot Index dipped 0.4% to the lowest in more than two years. The euro gained 0.5% to $1.2042, the strongest in almost three years. The British pound climbed 0.2% to $1.2957, the strongest in more than two weeks.
The Swiss franc jumped 1.2% to $0.9438, the strongest in about two years.
Bonds
The yield on 10-year Treasuries dipped five basis points to 2.11%, the lowest in almost 10 months. Germany’s 10-year yield decreased four basis points to 0.34%, the lowest in two months.
Britain’s 10-year yield declined five basis points to 1.003%, the lowest in 10 weeks.
Commodities
West Texas Intermediate crude climbed 0.1% to $46.63 a barrel. Gold increased 0.9% to $1 320.60 an ounce, the strongest in 11 months. Gasoline for September delivery fell 0.2% to $1.7098 a gallon after climbing 2.7% on Monday.
Asia
Japan’s Topix index closed 0.2% lower after falling as much as 0.7%, while South Korea’s Kospi index lost 0.2%, paring a drop of as much as 1.6%. The S&P/ASX 200 Index in Sydney declined 0.7%.
Hong Kong’s Hang Seng Index fell 0.4%, while the Shanghai Composite Index fluctuated before edging higher. Thailand’s SET Index bucked the main trend, rising 1.8%.
Concern about political violence has eased, according to CLSA. The yen advanced 0.6% to 108.58 per dollar. The won weakened the most in two weeks.
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