Nearly $1trn was wiped from global equity markets in the days after Trump’s now infamous threat that North Korea would be “met with fire and fury the like of which the world has never seen” last week.
While markets were more positive in trading on Monday, investors fled to the safe havens of gold and Japanese yen on the back of rising tensions between the US and the rogue Asian state.
Stephens, technical investment director at Rowan Dartington, said it was a sign of how big falls can be when markets are at all-time highs.
“It’s much easier to pass comment on market movements when it’s based on hard economic data, rather than digest what somebody has written on Twitter. Having said that, we believe sometimes the markets are looking for an excuse for a correction; before this crisis with North Korea, markets were at near all-time highs,” Stephens said.
“All it took was a few tweets to send the markets into a downward spiral, which was always going to be the case but at times like these, when markets are so high, this can sometimes be more pronounced.”
