Investing.com - The summer vacation in global financial markets is unofficially over now that investors have returned from the long Labor Day weekend.
So far, the first week of September has seen volatility come back in a big way.
Markets sold off sharply at the start of the holiday-shortened week as nervousness over North Korea’s nuclear display prompted investors to cut their exposure to riskier assets.
Tensions on the Korean Peninsula are likely to continue to simmer as experts believe Pyongyang is preparing for another weapons test around Sept. 9, when it marks the anniversary of its foundation in 1948.
Meanwhile, the euro saw a volatile afternoon of trade on Thursday as currency market players reacted to comments from Mario Draghi, the president of the European Central Bank (ECB).
The common currency was trading at around 1.1970 against the U.S. dollar before soaring 1% to 1.2060 after Draghi started his press conference. It was last at around the 1.20-level.
This came despite Draghi mentioning that the ECB is watching the euro’s volatility carefully, as it is a source of uncertainty.
With September being an historically bad month for stocks around the world, one can expect more volatility in the weeks ahead.
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