S&P Futs ‘Take Beating’; Yen, Franc Surge As North Korea Fires Missile Over Japan

Ok, there’s some potentially destabilizing shit going down.

Specifically, it looks like Kim might have launched a missile from Pyongyang that ultimately flew over Hokkaido.

BREAKING: Yonhap agency says South Korean military confirms North Korean ballistic missile flew over Japan.

— The Associated Press (@AP) August 28, 2017

https://twitter.com/HirokoTabuchi/status/902295396248166402

That’s obviously something nobody wants to hear and worse, reports now suggest that he may have fired a handful of them:

• SEVERAL MISSILES WERE FIRED BY NORTH KOREA, JAPAN GOVT SAYS:NHK
• NORTH KOREA APPEARS TO HAVE FIRED MISSILE TOWARD JAPAN: NHK

The reaction was swift for USDJPY which promptly broke Monday’s 109.03 low:

SPY dove as well with more than 8 million shares traded since 4 and about 1.4 million of them since 5 p.m. in New York.

$SPY $ES_F haul aaaassss! pic.twitter.com/jF1O8ZNZDy

— twobacons (@twobacons) August 28, 2017

“S&P 500 futures are taking a significant beating in a classic risk-off move, with the franc also getting a bid and commodity currencies under a bit of pressure,” Bloomberg writes, adding that “there’s still an element of wait-and-see about the market.”

Don’t let the irony inherent in the yen being the main beneficiary here be lost on you.

“It’s yen positive,” Tohru Sasaki, head of Japan markets research at JPMorgan Chase & Co. in Tokyo says, adding that “people may unwind JPY shorts.” Because nothing says “safe haven” like missiles flying over your head.

PM Abe says it does indeed appear that the missile passed over Japan’s airspace and that the government is “urgently collecting intelligence on the incident and doing everything to ensure the safety of its citizens.”

Japan’s Chief Cabinet Secretary Yoshihide Suga has confirmed that at least one missile flew over Japan’s Erimo Misaki and fell in the Pacific around 6:12am JST.

He went on to state the obvious, noting that a “missile flying over Japan is a new, serious development.”

Got it.

Oh, remember this from last week?….

"I respect the fact that I believe he is starting to respect us," Pres. Trump said of N. Korea leader Kim Jong Un https://t.co/ZN949ygZIV pic.twitter.com/55mqmNVhnT

— CBS News (@CBSNews) August 23, 2017