The global financial market “has no sleep for a night!” U.S. President Trump announced on Thursday the cancellation of the meeting with North Korean leader Kim Jong Eun scheduled for June 12 in Singapore. This sudden news shocked all market participants. The summit will be the first face-to-face talk between the US President and the North Korean leader. Affected by the rise of risk aversion, overnight US dollar and US stocks fell, while safe-haven assets such as yen and gold soared.
☆Satire! North Korea just blows up nuclear test site Trump and cancels "special fund meeting"
US President Trump announces cancellation of Thursday with North Korean leader Kim Jong-un originally scheduled to be held next month The summit, referring to North Korea’s “open hostility”, warned that the US military had already prepared for any reckless actions in North Korea. It is rather worth pondering that his decision was made several hours after North Korea blew up the country’s only nuclear test site.
Trump said in an open letter to Kim Jong-un that the DPRK’s recent statement showed extreme anger and open hostility. He therefore felt that it was inappropriate to hold the DPRK-US summit at this time. He did not say "postponed," but solemnly stated that the Singapore meeting will not be held.
This marks Trump's optimism that has come to an abrupt end in the past few weeks, that is, success and Kim Jong-un. The meeting may allow him to do what the previous U.S. presidents failed to do and persuade North Korea to abandon its nuclear weapons program.
North Korea dismantled and blew up the Fengxi-ri nuclear test site in the northern part of the country on the afternoon of the 24th local time witnessed by a group of foreign reporters. This is considered to be North Korea’s goal of denuclearization. The essence of the moveOne step. The Fengxili Nuclear Test Site is North Korea's only nuclear test site known to the public. North Korea’s six nuclear tests were held here. Because North Korea has a small area and is limited by natural conditions, it is not easy for scientists to reconstruct a new nuclear test site. Recovering the Fengxili Nuclear Test Site means incredible workload.
Analysts pointed out that just hours after North Korea blew up the nuclear test site, Trump’s letter to the Gent was publicized. The time difference between these hours may be considered by Pyongyang as "intentional." "Increase the anger of North Korea.
In response, senior White House officials said North Korea did not allow experts to witness the dismantling of the nuclear test site. Commitment, this means that no one can verify the real situation there. North Korea has chosen some international media to witness the dismantling of the Fengxili nuclear test site.
The U.S. State Secretary Mike Pompeo stated that North Korea has not responded to its contacts in recent days and Trump decided on Wednesday that the summit would not be successful. Pompeo had twice visited Pyongyang and met with Kim Jong-un. "We have contacted again but we have not received a response," said Pompeo. He also said that it was disappointing, but "it is not really an accident."
Trump said at the White House that he is still open to dialogue but has spoken to Secretary of Defense Mattis (James Mattis) and warned North Korea not to take any reckless actions. He pointed out that if North Korea “imposes some unfortunate situation on us”, the US allies, South Korea and Japan, are also prepared to share a large part of the financial burden.
☆The President of South Korea "has been!" The international community regrets the cancellation of the “Special Money Club”
According to an article from Reuters, South Korea’s President Wen Jun’s “completely screwed up” decision by the cancellation of the summit. He has been In order to promote the active summit, when the White House met with Trump at the White House on Tuesday, he also humbly asked not to allow this golden opportunity to slip away. He called on Trump to have direct talks with Kim Jong-un.
Although Trump did not completely shut the door to talks with Kim Jong EunHowever, it is very unlikely that the meeting will be rescheduled immediately. In addition, the summit cancelled concerns that will rekindle the recurrence of the Korean Peninsula conflict.
Trump even mentioned the possibility of war in the letter. "You talked about your nuclear capabilities, but our nuclear capabilities are so powerful that I pray to God that they will never be used passively," he said. The cancellation of the summit also crippled the great diplomatic accomplishments that Trump’s supporters had hoped for. They felt that this achievement deserved the Nobel Peace Prize.
Wen stated that he was puzzled by the cancellation of the “Special Money Club” and regretted that the denuclearization of the peninsula should not be postponed. Wen said that the peace process and permanent peace in the peninsula are historical tasks that cannot be abandoned and cannot be postponed. It is believed that the sincerity of all parties that have worked hard to solve the problem will not change due to the current communication methods. Unable to solve sensitive and difficult diplomatic issues. It is hoped that problems will be solved through a more close and close dialogue among leaders.
For US President Trump's decision to cancel the “Gold Club”, North Korea responded that the leaders of North Korea and the United States need not meet. The DPRK is ready to dialogue with the United States to resolve the issue.
North Korean Deputy Foreign Minister Kim Ki-gwan claimed that the DPRK and U.S. leaders do not need to meet. In order to meet U.S. President Trump, North Korea’s top leader Kim Jong-un has given his best efforts, but the U.S. still announces the cancellation of the meeting. This is contrary to the wishes of the world. However, the door to the dialogue is still open. The DPRK side is willing to dialogue with the US to resolve the issue at any time. Kim Kye-kwan said that the DPRK had hoped that issues related to North Korea could be resolved through the "Trump model."
The international community also regrets this. UN Secretary-General Guterres said he was deeply concerned about the cancellation of the “Special Fund” and urged the United States and North Korea to continue their dialogue. Guterres said that the complete elimination of nuclear weapons is the top priority, but efforts to achieve this goal are facing serious crises. He said that the negotiating parties to the Korean nuclear issue need a steel-like will and urge them to continue their efforts.
The Russian Ministry of Foreign Affairs stated that it regrets the cancellation of the “special fund” by US President Trump. A spokesman for the British Prime Minister stated that he was disappointed with the cancellation of the “Special Fund”.Efforts will be made to reach agreement on nuclear weapons. The Singapore side stated that it regretted the cancellation of the summit between the United States and North Korea and hoped that the dialogue and efforts to achieve permanent peace and stability on the Korean Peninsula will continue.
☆ The global market is again raging with blood, and gold yen is a safe haven!
The news of the cancellation of the “Special Money Club” completely deflated market risk aversion overnight, and the two major safe-haven assets, the yen and gold, soared on Thursday. In addition, global stock markets plummeted, and then remained somewhat stable. The safe-haven buying of U.S. public debt pushed down the yield on U.S. debt, while the U.S. dollar was weaker.
Quotes show that after the news of the cancellation of the “Special Money Club”, the price of gold rose sharply and exceeded the key level of 1300 US dollars. In the New York session, the highest intraday price reached 1306.56 US dollars per ounce.
Comex's most active gold futures contract traded at 21:50 a.m. on Thursday morning. 10197 hands, the total value of the trading contract is over US$1.3 billion! The transaction volume of COMEX's most active gold futures contract was 12,423 in four minutes during Beijing time 21:52-21:55, and the total value of the contract was more than US$1.6 billion.
“The news of the cancellation of the U.S.-DPRK summit made gold gain momentum,” said Phil Streible, senior market strategist at RJO Futures.
U.S. stocks closed slightly lower on Thursday after President Trump canceled the planned summit with North Korean leader Kim Jong-un and threatened to impose auto import duties, but Netflix and General Electric rose. Limit the decline in the broader market.
On the foreign exchange market, the US dollar fell against a basket of currencies on Thursday, hitting a two-week low against the yen, as US President Trump canceled the summit with North Korean leader Kim Jong Eun and traders against the U.S. dollar The recent rally has taken a profit. The US dollar index fell 0.26% to 93.76, while the US dollar fell 0.75% to 109.24. The yen is usually rising during the turmoil in the market.
Commonwealth Foreign Exchange Inc's Chief Market AnalysisOmer Esiner said, “After Trump's statement is published, global financial market hedging needs to be slightly warmed up.”
“At the same time, the U.S. dollar suffered more widespread selling, not only It is because of hedging," said Paresh Upadhyaya, a director of the foreign exchange strategy division of Amundi Pioneer Investments. “I wonder if this is because the market is currently reassessing the degree of geopolitical risk. With the increase in signs of the DPRK-US summit earlier in May, geopolitical risks began to abate.”
Sony Financial Holdings Kumiko Ishikawa, a foreign exchange strategist based in Tokyo, said on Thursday: “All the risk factors that have been brought back behind the scenes are returning to the stage: the variables of the U.S. and North Korea summits, the tension between U.S.-China trade, the political situation in Italy, and the euro economy. Growth concerns."
Ishikawa pointed out that if the Japanese stock market continues to fall, the USD/JPY may approach the May 4 low of 108.65; if it falls below this level, the market outlook target will be around 108.
Foreseeing market outlook, industry insiders pointed out that during the Asian-European session, investors are expected to continue to digest the negative impact of the cancellation of the “Special Fund”, especially for foreign exchange and precious metals investors. The performance of the stock market. If the stock market is under heavy pressure, it is likely to further aggravate the market's safe haven.
Of course, the US Federal Reserve Chairman Jeremy Powell will also make a speech this evening, which is likely to become the next catalyst to influence the market trend. According to the schedule, Powell made a speech on financial stability and transparency at 21:20 Beijing time on Friday. Powell had previously published hawkish remarks at a policy meeting sponsored by the International Monetary Fund (IMF) and the Swiss National Bank. Tonight, his speech on inflation is still the focus of attention, and the market will seek clues as to whether the Federal Reserve will accelerate interest rate increase.
Analysts pointed out that if Powell republished hawkish remarks this week, it is expected to ease the minutes of the previous meeting. The "damage" caused by the dollar boosts the dollar, while the gold price faces downside risks.