LONDON (ShareCast) - (ShareCast News) - Stocks were seeing a small bid with traders hoping that the most recent statements from Pyongyang might mean that tensions on the Korean peninsula were now headed well and truly lower, despite which a widely-followed gauge of stockmarket volatility was holding near its recent highs.




As of 0914 BST the benchmark Stoxx 600 was edging higher by 0.06% to 0.23 points to 376.39, alongside a 0.22% or 26.47 point gain for the Dax to 12,194.57 while the Cac-40 was rising 0.25% or 12.99 points to 5,134.25.

In parallel, euro/dollar was edging lower by 0.20% to 1.1752 and Brent crude oil futures by 0.16% to $50.65.

The VStoxx volatility index for the Euro Stoxx 50 was only 2.54% lower at 15.27.

Overnight, US Defence Secretary James Mattis warned North Korea that a missile strike that hit US territory, including Guam, would meet a response.

The day before, South Korea's president Moon Jae-in had stressed in a meeting with US general Joseph Dunford that "no one may decide to take military action without the consent" of the South.

Soon after Mattis spoke, North Korean state media said that its leader Kim Jong-un had reviewed plans to fire missiles towards the US Pacific territory of Guam but would wait and watch to see what the US did.

Commenting on the situation, Stuart Culverhouse, global head of macro and fixed income research at Exotix Capital, said: "Today's statement from North Korea, coming after more conciliatory tone from the US administration yesterday, may help to de-escalate the threat of conflict and reassure investors after a nervous few days. There remains a risk of a renewed war of words, if not worse, but this outbreak of calm may be something to build on in terms of dialogue."

Meanwhile, Germany's economy slowed a tad in the second quarter with foreign trade exerting a drag on activity. Gross domestic product expanded at a 0.6% quarter-on-quarter pace over the three months to June, according to the Federal Office of Statistics.

That was one tenth of a percentage point less than expected by economists. However, the prior quarter's rate of GDP growth was revised up from 0.6% to 0.7%.

Still on the calendar for later in the day, US retail sales figures for July were scheduled for release at 1330 BST,

Shares in Danone were on the up after Bloomberg TV, citing people familiar with the matter, reported that activist hedge-fund Corvex Management had taken a stake in the company.

K+S was sharply lower after the company told markets it was unlikely to reach its 2020 targets due to the slow recovery in potash prices.

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