Markets steady after N Korea test

North Korea's move rattled Asian markets

European stock markets have remained resilient following the news of North Korea's nuclear weapon test.

After slipping in early trade, London's FTSE 100 index was up 0.49% at close, and both the Frankfurt Dax and Paris Cac only showed minor closing changes.

Earlier in Asia, South Korea's main Kospi index had ended down 2.4% while Hong Kong's Hang Seng fell 1.3%.

Japan's Nikkei was closed on Monday for a public holiday, but the yen hit an eight-month low against the US dollar.

'Further reactions'

North Korea's test came in defiance of international protests including strong warnings from both China and Japan.

The impact won't be very significant unless there was a major military confrontation Analyst Wang Qing

Analyst Jackson Wong, an investment manager at Tanrich Securities in Hong Kong, said stocks in the region were down "as investors were worried that political tensions will trigger a sell down in Asian markets".

"Trade in coming days will likely depend on North Korea's further actions regarding the test and how countries like the US react to North Korea's move," he added.

Mr Wong said a key test will be how Japan's Nikkei reacts when it reopens on Tuesday.

Fellow Hong Kong-based analyst, Wang Qing, an economist at Bank of America, agreed that the continuing reaction of Far Eastern markets would depend upon the response of the international community.

"The economy of North Korea is virtually closed from the rest of the world and its regional impact won't be very significant unless there was a major military confrontation," he said.