NBC and CNN are currently running stories that North Korean leader Kim Jong-un has slipped into a coma following complications from cardiovascular surgery and is in “grave danger.” NBC went one step further, saying that he may be brain dead in a Tweet. I’ll not argue that point and the Tweet itself has since been deleted. It is important to note, though that the story is originating from intelligence sources monitoring North Korea. That seems to be a rather tenuous source to be scooping the media on such an important event potentially.

As if by magic, Yonhap News Agency in South Korea has quoted a South Korean Government source, as saying they have seen no unusual signs concerning Kim Jong-un’s health. One or more tier-1 news organisations are about to get egg on their face, and or face a harsh lesson in the perils of reporting by social media, without adequately verifying stories. I am just not sure which it will be.

Financial markets are refusing to get whipsawed over the event though, taking a “where there is smoke, there is fire” point of view. The Korean Won has fallen by 1.0% against the Dollar to 1232.70, a slight improvement from the initial post-headline reaction. We can be sure that the Bank of Korea will not let volatility get out of hand on the Won.

Equities were already on the back foot after a negative session on Wall Street overnight. In that context, regional markets have only priced in a small-ish reaction to the news relative to their performance before it. The Kospi took another leg down after the initial headlines and is now 1.80% lower on the day. Other North Asian markets with plenty of skin in the South Korea game have also moved lower. Taiwan is down 2.90%, the Nikkei 225 is down 1.80%, Shanghai is down 1.0%, and the Hang Seng is 2.30% lower.

That said, if the North Korean news proves to be correct, the region is set for a period of uncertainty. Like all good Communist Peoples Democratic Republic’s, Kim Jong-un was its leader for life, and he had weeded out a goodly number of potential rivals already. That leaves a nuclear-armed North Korea with giant armed forces, facing a potentially messy succession process. China will also want to have its input into the process, forcefully if necessary.

Nobody should be pricing in a German unification scenario at this moment, assuming South Korea could afford it. Instead, if proven right, the succession process in North Korea will almost certainly hang like a dark cloud over Asian markets until we get a resolution, and hopefully not a revolution. Assuming, of course, the news is accurate, which we don’t know yet either.

Never to be outdone on Twitter, President Trump has, almost simultaneously, announced that he is suspending immigration to the US to protect American jobs in response to the COVID-19 pandemic. This is more headline baiting than substance in my humble opinion and will have zero effect on financial markets. Nobody is immigrating anywhere in the world now, let alone the US, the centre of the COVID-19 pandemic. No one is likely to be allowed to immigrate anyway for a long time, unless it’s on a repatriation flight. Even after peak virus is achieved, borders and air-travel are likely to remains strictly limited for obvious reasons. North Korea is a more important story today.

On a more positive note, the US and Europe appear to be edging towards more fiscal stimulus measures this week. In the US’ case, a follow-on $500 billion spending bill that could be enacted this week. European leaders will meet remotely to thrash out the details of a Trillion Euro recovery fund. As ever with Europe though, things will not move either quickly, or in a linear fashion. Nevertheless, the potential of both coming to fruition should ensure that equity markets hold onto most of their gains for now.

Oil’s roller-coaster ride overnight is well documented. Much has been made of the losses sustained by those selling May WTI futures at -$37.00 a barrel. I would note though, that for every seller there is a buyer. Somewhere in the world yesterday, someone was getting paid by sellers to buy oil, and is likely to be cracking the champagne today. Harsh lessons were learnt yesterday, about the perils of being stubborn on roll costs and holding deliverable futures to maturity, especially when you don’t have an underlying commercial interest. That lesson will ensure that the same does not happen again with the rolls into the June/July contracts.

WTI spot fell 13.50% yesterday to $17.50 a barrel and is unchanged in Asia. Brent crude fell %8.0 overnight to $26.00 a barrel. Profit-taking in Asia has seen it climb by 50 cents in the morning session. The debacle in the WTI futures of the past few days, has highlighted just how oversupplied global markets are with oil and the challenges of storing it. With an estimated demand short fall of 20 million barrels a day; unless the US miraculously reopens tomorrow and everyone jumps in their SUV, or OPEC+ brings forward and deepens production cuts, more downside pain on spot prices still looms for both contracts