The Australian share market has slumped to a 10-week low after North Korea fired a missile over Japan, escalating tensions on the Korean peninsula and spooking Asian markets.

The benchmark S&P/ASX200 dropped 40.9 points, or 0.72 per cent, to 5,669 points, its lowest level since mid-June.

The heightened political tension also weighed on the Australian dollar, which fell from an overnight high of 79.71 US cents to be at 79.40 US cents at 1700 AEST.

Asia’s major markets all fell in the wake of the North Korean missile test.

ASR Wealth Advisers senior adviser Cai Lewis said the latest escalation by North Korea was at the forefront of investors’ minds, and is likely to unsettle markets in the US.

“Right now, the market is waiting to see the official response from the US and what sort of rhetoric we’ll get from President Trump,” Mr Lewis said.

Locally, the major banks were the biggest weight on the market, with Commonwealth Bank, Westpac, National Australia Bank and ANZ all dropping by around 1.2 per cent.

Investors favoured safe-haven gold stocks, with Newcrest Mining up 2.2 per cent at $22.86 and Evolution Mining up 1.3 per cent at $2.42.

Rio Tinto and BHP Billiton were relatively steady.

Vitamins supplier Blackmores gained $6.82, or 7.5 per cent, to $97.99 as it forecast a better year ahead after its annual profit fell 41 per cent due to the impact on sales of weaker Chinese buying.

Regional Express ascended eight cents, or 7.4 per cent, to $1.165 after the airline rebounded from the prior year’s loss with an annual net profit of $12.6 million, and said it would pay its first dividend in five years.

Rivers and Katies owner Specialty Fashion plunged 10.5 cents, or 23.1 per cent, to 35 cents after its annual loss more than quadrupled to $8.4 million because of store closures and asset impairments.

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