Pyongyang has preened itself as the proud owner of a "hydrogen bomb of justice" but while the pariah country succeeded in elevating geopolitical risks, historical data shows it's unlikely to spook markets.
North Korea, one of the world's most isolated economies, claimed that it had successfully tested a miniature hydrogen bomb on Wednesday, sparking the ire of neighboring South Korea, China and Japan and inviting threats of further sanctions.
Initially reported as an earthquake, it was North Korea's fourth nuclear test since 2006 as leader Kim Jong Un consolidates his leadership and seeks to show off the country's technological prowess. It was also the first reported instance of a hydrogen device. Previous tests—in 2013, 2006 and 2009—centered on plutonium and uranium bombs, which are considerably less powerful.
While Asian markets extended losses on Thursday following a knee-jerk reaction in the previous session, history indicates that markets tend to largely ignore Kim's nuclear pomp and circumstance.
A day after North Korea conducts a nuclear test, major Asian stock indices fare well both in the short and long term, according to big data analytics service Kensho.