North Korea said Wednesday it had successfully launched the Hwasong-15 intercontinental ballistic missile capable of hitting the US mainland and completed its state nuclear force.

The drop in South Korea's credit default risk strikes a sharp contrast to its surge in September amid sharp tensions stemming from a hectic war of words between US President Donald Trump and North Korean leader Kim Jong-un over the North's nuclear and missile programs.

The risk premium soared to a 19-month high of 75.43 basis points on Sept. 27. Defying international sanctions, Pyongyang conducted its sixth and most powerful nuclear test in early September. North Korea's latest missile launch also had little impact on South Korea's foreign exchange and stock markets.

According to market watchers, foreign and domestic investors appear immune and impervious to North Korean provocations, believing they would not develop into an armed conflict or other extreme situations.

"The market is familiar with North Korea's provocations," said Seo Hyang-mi, an analyst at Hi Investment & Securities Co. "Without putting a premium on North Korea risks, market participants are not reacting sensitively."

Global rating agency Standard & Poor's reaffirmed Wednesday that North Korea's provocations may continue sporadically, which will not have a great impact on South Korea's sovereign credit rating of AA. (Yonhap)