LONDON MARKETS: FTSE 100 Bounces Back From 1-week Low As North Korea Fears Ease

By Sara Sjolin, MarketWatch Features Dow Jones Newswires

Gold miners fall back after Tuesday's geopolitics-fueled rally

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U.K. stocks were on track to break a two-session losing run on Wednesday, with investors' appetite returning as concerns over a nuclear war between the U.S. and North Korea abated for now.

The FTSE 100 index rose 0.5% to 7,372.10, partly erasing a 0.9% loss from Tuesday (http://www.marketwatch.com/story/uk-stocks-knocked-sharply-lower-after-north-korea-launches-missile-over-japan-2017-08-29), when the benchmark ended at its lowest level since Aug. 21. That slide 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, which was seen as another direct provocation from Pyongyang meant to destabilize the Asian region.

U.S. stock markets opened lower on Tuesday after the missile test, but staged a rebound later in the session to close in positive territory (http://www.marketwatch.com/story/dow-futures-stumble-more-than-100-points-as-north-korea-tensions-flare-up-again-2017-08-29). That turnaround came after what were seen as measured and balanced responses to the missile test from U.S. President Donald Trump and the rest of the global community, according to analysts.

"Investors were relieved to see that the U.S. president reacted in a tempered manner, opting not to escalate the issue by taking immediate action against the North Korea regime," said Konstantinos Anthis, researcher at ADS Securities, on Wednesday.

"The move away from the risk-off trade pushed the safe haven instruments down, with the yen and gold both giving up significant ground," he said in a note.

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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)

Gold prices settled at an 11-month high on Tuesday (http://www.marketwatch.com/story/gold-hits-11-month-high-as-another-north-korea-missile-sparks-haven-flight-2017-08-29), sending shares in U.K.-listed precious-metals miners sharply higher. However, on Wednesday gold erased 0.4% to hit $1,313.10, pulling Randgold Resources Ltd. (RRS.LN) (RRS.LN) and Fresnillo (FRES.LN) down 1% and 0.7%, respectively.

In economic news, U.K. mortgage approvals and consumer credit figures are due at 9:30 a.m. London time, or 4:30 a.m. Eastern Time.

The pound was slightly higher against most other major currencies, buying $1.2927 compared with $1.2919 late Tuesday in New York.

(END) Dow Jones Newswires

August 30, 2017 04:16 ET (08:16 GMT)