EUROPE MARKETS: European Stocks Rebound From 6-month Low As Traders Shrug Off North Korea Fears

By Sara Sjolin, MarketWatch Features Dow Jones Newswires

German inflation on tap

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European stocks rebounded from a six-month low on Wednesday, as heightened tensions after North Korea's latest missile launch eased for now and spurred investors to take on more risk.

The Stoxx Europe 600 index rose 0.5% to 370.40, after sliding 1% to settle at its lowest level since Feb. 10 on Tuesday. That drop came after North Korea launched a ballistic missile (http://www.marketwatch.com/story/north-koreas-outrageous-missile-launch-over-japan-inflames-tensions-again-2017-08-29) over Japan, in a move seen as another direct provocation from Pyongyang meant to destabilize the Asian region.

Overall financial markets were Tuesday marked by a big rush out of assets perceived risky, such as stocks, and into havens, such as bonds, the yen and gold. U.S. stocks, however, managed to shake off the concerns (http://www.marketwatch.com/story/dow-futures-stumble-more-than-100-points-as-north-korea-tensions-flare-up-again-2017-08-29) to close higher and Asian markets scored firm gains (http://www.marketwatch.com/story/asian-markets-rebound-shrugging-off-north-korea-tensions-2017-08-29) on Wednesday.

"Financial markets' concerns about North Korea's missile shot have faded rapidly. People are naturally programed to be optimistic, so the reaction is not that surprising," said Paul Donovan, global chief economist at UBS Wealth Management, in a note.

"The market reaction is similar to those in the 1990s when missile tests were common, although the U.S. does have a president of a different temperament today," he added.

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Read:Dow industrials just booked the best intraday comeback in 9 months (http://www.marketwatch.com/story/dow-just-booked-its-best-intraday-comeback-in-9-months-2017-08-29)

And see:How North Korea and Harvey rattled markets, in 4 charts (http://www.marketwatch.com/story/how-north-koreas-latest-offensive-harvey-carnage-and-low-volumes-rattle-stock-market-2017-08-29)

Analysts also said measured and balanced responses to the missile test from U.S. President Donald Trump and other global leaders helped to calm fears about a possible escalation in the conflict.

Stock movers: Precious-metal miners slumped in Wednesday's trade. Shares of Polymetal International PLC (POLY.LN) lost 1.9%, Centamin PLC fell 1.6%, and Randgold Resources Ltd. (RRS.LN) (RRS.LN) dropped 1.3%.

Gold miners were among the biggest advancers on Tuesday, tracking gains for the metal , which settled at an 11-month high (http://www.marketwatch.com/story/gold-hits-11-month-high-as-another-north-korea-missile-sparks-haven-flight-2017-08-29) as part of the flight to haven assets. Gold, however, slipped 0.3% to $1,314.70 an ounce on Wednesday.

BioMerieux SA (BIM.FR) rallied 7.8% to the top of the Stoxx 600 after the French biotech company lifted its 2017 sales guidance.

Baloise Holding AG (BALN.EB) rose 3.5% after the Swiss insurer said first-half profit soared 34%.

Telenor ASA (TEL.OS) climbed 1.8% after the Norwegian telecom company announced plans for a buy-back program.

Economic news: Inflation in Spain rose to 2% in August, up from 1.7% in July and higher than the 1.8% forecast.

German inflation figures for August are due at 1 p.m. London time or 8 a.m. Eastern Time, forecast to show a rise to 1.7% from 1.5% in July for the EU harmonized data.

Eurozone consumer confidence rose to minus 1.5 in August from minus 1.7 in July, while the bloc's reading on economic sentiment climbed to 111.9 from 111.3, according to Dow Jones Newswires.

Indexes: Germany's DAX 30 index climbed 0.6% to 12,015.67, set to break a three-session losing streak.

France's CAC 40 index gained 0.4% to 5,052.78, while the U.K.'s FTSE 100 index added 0.4% to 7,362.74.

The euro fell to $1.1945 from $1.1974 late Tuesday in New York.

(END) Dow Jones Newswires

August 30, 2017 05:29 ET (09:29 GMT)