USA stocks fall on North Korea worries

The threat, reported by he state-run KCNA news agency, came just hours after U.S. president Donald Trump warned any threat to the USA would be met with "fire and fury".

U.S. stocks have risen week after week this year - with the S&P up more than 9 percent - in extremely low volatility, as strong corporate earnings and an improving global economy offset disappointment that U.S. President Donald Trump's promises to lower corporate taxes and implement a massive infrastructure spending have so far failed to see the light of day.

In an apparent response to Trump's tweet, a statement issued by North Korea's official KCNA news agency claimed the president is "driving the situation on the Korean peninsula to the brink of a nuclear war".

The CBOE Volatility Index, the most widely followed barometer of expected near-term stock market volatility, closed at its highest in about a month.

Considerable weakness is also visible among tobacco stocks, as reflected by the 1.1% drop by the NYSE Arca Tobacco Index.

The Stoxx Europe 600 was down 1% in midday trade, while futures signaled the S&P 500 would open down 0.2% and the Dow Jones Industrial Average would open 0.1% lower.

Money also flowed into consumer discretionary stocks.


Nordstrom shares were up 1.63 percent at $45.60 following the apparel retailer's better-than-expected quarterly same-store sales.

But although US equities on Wednesday managed to close only slightly down even after Trump's warning that "fire and fury" would rain on North Korea, on Thursday the chickens came home to roost on Wall Street. In 3.08pm trading, the Standard & Poor's 500 Index fell 1 percent.

North Korea's threat to carry out a missile strike on Guam continued to worry investors. Germany's DAX Index fell 0.6 percent, while the UK's FTSE 100 Index retreated 1.2 percent, and France's CAC 40 Index slid 1.4 percent. The Dow also fell 0.5% to dip briefly back below the 22,000 mark, and the Nasdaq tumbled almost 1%. The yield on the 10-year Treasury note held steady at 2.26%. Netflix lost 1.5 per cent.

Semafo jumped 10.3 percent to C$2.99 after Credit Suisse raised its recommendation on the gold miner to "outperform" from "neutral" following its second-quarter results, and Finning International Inc rose 6.9 percent to C$27.63 after the heavy equipment company reported quarterly earnings that beat expectations and raised its dividend.

Avis Budget Group slumped 9.9% after the vehicle rental company cut its guidance following a weak second quarter.

CURRENCY: The dollar declined to 109.77 yen from Tuesday's 110.34.

ENERGY: Benchmark U.S. crude lost 23 cents to $48.94 per barrel in electronic trading on the New York Mercantile Exchange. The euro edged down to $1.1727 from $1.1751.

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