The day North Korea blinked:

It appears that North Korea has failed at holding the world hostage. The recent missile tests have not been nearly as successful as they had hoped. This is a very good thing for Japan and South Korea as this failure may keep North Korea from being over aggressive going forward.

The global equity markets have no reacted dramatically to the news as most investors now realize that North Korea is mainly all talk with little ability to follow through on their threats. The market in North America are down at the start of the day but are likely to be in positive territory by the close as investors shrug off the current threat.

The North Korean government has been holding the US hostage with threats of nuclear action and in the past the US and others have paid North Korea in the form of aid to back off. This recent missile test has reduced N. Korea’s ability to continue to demand payment. This will prove to be very beneficial for the rest of the world as tensions will be much lower now that North Korea has proven they are not nearly as much of a threat as they had indicated.

The bigger news this week will end up being the non-farm payroll report on Friday, the market is expecting 170,000 will have been created for the month of June anything higher will increase the potential for an increase by the FOMC in August, stay tuned.