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World Stocks Tumble Over China's Economy and North Korea Nuke Test

World Stocks Tumble Over China's Economy and North Korea Nuke Test

By Rodrigo Campos via Reuters

Stocks across the world fell for a fifth consecutive day on Wednesday as China fueled fears about its economy by allowing the yuan to weaken further and a nuclear test by North Korea added to a growing list of geopolitical worries.

Crude futures tumbled further as a row between Saudi Arabia and Iran made any cooperation between major exporters to cut output even more unlikely. Both Brent and WTI fell below $35 a barrel.

Stocks opened more than 1 percent lower on Wall Street despite strong U.S. job market data, tracking declines in European markets and most of Asia, while safe-havens such as the Japanese yen, U.S. and German bonds, and gold strengthened.

Traders and economists fear the move from China to further depreciate the yuan may mean the world's second-biggest economy is even weaker than had been expected and that it could trigger another wave of competitive devaluations.

North Korea's announcement that it had successfully conducted a test of a hydrogen nuclear device added to geopolitical worries stirred by a row between Saudi Arabia and Iran.

"It's scary when you see the second largest economy on the planet seemingly melting down," said Brad McMillan, chief investment officer at Commonwealth Financial in Waltham, Massachusetts.

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