Asian Markets fall on Kim Jong-Il death

FXstreet.com (Barcelona) - News of Kim Jong-Il sudden death by heart attack hit the Asian markets violently, leading them to fall on future geopolitical stability. The South Korea’s Kospi dropped by -3.43%, while Shangai Composite drowned by -0.30% and Hong Kong’s Hang Seng fell by -1.26%.

South Korea army went on high alert and authorities are will be watching financial markets volatility. Japanese Prime Minister set up a crisis management team on North Korea. Meanwhile, Nikkei average dropped by -1.21%.

“We believe the chances of a military aggression are limited. ... The Northern regime will be prickly over coming months, and we should look out for signs that it is withdrawing from low-level diplomatic efforts to mend fences”, said RBS economist Erik Lueth that predicts 2-week volatility on North Korea’s leader death aftermath.

The downward pace was already in motion due to Fitch’s negative outlook toward several Eurozone countries on late Friday and Belgium downgrade to Aa3 by Moody’s. The Eurozone crisis will remain as the main issue on Monday ahead in a year-end market, with increasingly low volume.

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