United States stocks looked set to extend yesterday's losses, with the Dow Jones opening 0.2% lower, the S&P 500 by 0.5% and the NASDAQ Composite by 0.9%. Hong Kong's Hang Seng Index plunged by 2 percent, while South Korea's Kospi Index slumped by 1.7 percent. The Nasdaq composite lost 37 points, or 0.6 percent, to 6,332. The Korea tensions though have seen both USA and European markets this week push back expectations of when the Fed and ECB might hike interest rates. "And while risks remain elevated from a geopolitical perspective, valuations are not necessarily excessive, though full". Stocks may remain pressured this afternoon, as market players remain hesitant to carry riskier assets ahead of the USA inflation data, scheduled for later today.
The stage was set for the USA indexes to go lower early Wednesday as investors around the world reacted to the rising war of words between the US and North Korea, pushing global market indexes lower.
U.S. President Donald Trump told reporters at his golf club in Bedminster, New Jersey, on Thursday that he will respond forcefully to any North Korean attack on the U.S. or its allies.
Sterling slipped below $1.30, close to a two-and-a-half-week low but it strengthened against the euro by 0.2%, following Tuesday's 10-month low.
The firm tracks about $2.46 billion of the island's outstanding municipal debt. It usually moves opposite to stocks' movements and rises when the S&P 500 falls. They soared over 2 percent in the previous two sessions, and are set for a weekly gain of 2.2 percent.
The escalation of the rhetoric between the U.S. and North Korea is keeping market participants on their toes and with no fresh economic reports the price action is dictated by the headlines.
The CBOE Volatility Index .VIX , a barometer of expected near-term stock market volatility, closed at its highest since the election.
The figure reflected a 2.9 percent rise compared to one year ago.
"A week of low volatility has been hit with an unexpected rush to safe havens as the US-North Korean feud has ratcheted up once more", said IG analyst Joshua Mahony.
LACKLUSTER QUARTER: Office Depot sank 22.4 percent after the office supply company's second-quarter results fell short of Wall Street's projections. It rose $15.70, or 1.2 percent, to $1,277.80 an ounce.
Markets are now focused on US consumer price data for July, due later in the session.
Nikkei was down by 1.29 percent while Indian stock market closed 0.68 percent lower.
An editorial in China's state-run Global Times (http://www.globaltimes.cn/content/1060791.shtml), published late Thursday local time, added to the pressure on Asian markets. Earlier, the average had been down more than 88 points.
On August 8, it rose 8.9% to 11.94.
Worries over a potential confrontation between the United States and North Korea weighed heavily on global stock markets on Wednesday but helped boost the price of assets, such as gold and the Swiss franc, that are considered safe havens in times of geopolitical peril.