The United Nations failed to agree on a response to North Korea's long-range rocket launch despite pressure from Washington and its allies for action, while regional powers weighed the extent of the new security threat.

Analysts said Sunday's launch of the rocket – which flew over Japan during its 3,200 km flight – was effectively a test of a ballistic missile designed to carry a warhead as far as the US state of Alaska.

They said an emboldened North Korea would use the first successful launch of its Taepodong-2 missile to extract concessions for showing up at any future round of six-party talks on ending its nuclear programme. It could also seek to water down obligations it signed onto under previous negotiations.

"With this capability, North Korea is equipped with the infrastructure to play the nuclear game and raise the stakes in the six-way talks," said Kim Tae-woo, a nuclear and weapons expert at the Korea Institute for Defence Analysis.

"As a result, more will have to be given to persuade North Korea to give up its nuclear programme."

The long-running talks among the two Koreas, China, Japan, Russia and the United States have been stalled since December.

South Korean and Japanese financial markets shrugged off news of the rocket launch. Seoul's main share index was up 0.8 per cent while the won currency was stronger against the dollar as investors cheered Wall Street's gains last week.

Shares in Japan also traded higher, with the Nikkei index up 0.8 per cent after earlier rising 2 per cent.

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