Tension escalated between North Korea and the United States after President Donald Trump warned the rogue state is facing "fire and fury" and North Korea state media responded by saying the country is considering a missile strike against the U.S. Pacific territory of Guam
Global and national stock markets, however, remain largely unperturbed.
While safe havens such as gold saw a bump, the CBOE Volatility Index is still down more than 16 percent this year, and the Dow and S&P 500 declined less than 0.5 percent in trading Wednesday.
"Is a superpower involved?"
"Is there a risk to oil prices?"
"Is there a risk to the global financial system?"
The tension with North Korea appears to require an affirmative answer to the firm's first question, as the isolated nation's threat of a missile attack on Guam would fulfill Columbia Threadneedle's criterion for the potential of a superpower being "quickly drawn into a situation." North Korea's saber rattling also could quickly escalate and "ignite involvement from several other countries," to other points the firm said investors must gauge.
Reference: CNBC
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