Singapore shares tumble over 1%, Asian stocks decline amid jitters over North Korea nuclear test

The local benchmark Straits Times Index was down about 1.3 per cent by 3.30pm, tracking declines across the region.
The local benchmark Straits Times Index was down about 1.3 per cent by 3.30pm, tracking declines across the region. PHOTO: AFP

SINGAPORE - Local shares have dropped over 1 per cent on Monday (Sept 4) as North Korea's latest nuclear test prompted caution across Asian equities.

The local benchmark Straits Times Index was down about 1.3 per cent by 3.30pm, tracking declines across the region.

North Korea conducted its sixth and most powerful nuclear test on Sunday.

It said the text was of an advanced hydrogen bomb for a long-range missile, prompting the threat of a "massive" military response from the United States if it or its allies were threatened.

"Global risk appetite is likely to be deterred somewhat by North Korea's latest weekend test of a hydrogen bomb which drew widespread condemnation and may overshadow the disappointing United States unemployment report on Friday," OCBC Bank said in a note.

Seoul shares were hit hard, with the Korea Composite Stock Price Index (Kospi) ending 1.2 per cent lower, its weakest closing level in three weeks.

South Korea's defence ministry said in a parliamentary hearing on Monday that it continues to detect signs that North Korea is preparing more ballistic missile launches.

Tokyo's Nikkei index meanwhile closed 0.93 per cent lower, as jittery traders bought the yen - a safe haven currency in times of turmoil - which dents the outlook for Japanese exporters' profitability and weighs on their shares.

The Hang Seng Index in Hong Kong fell 0.5 per cent.