SIMMERING TENSIONS: North Korea revealed on Thursday a detailed plan to launch a salvo of ballistic missiles toward the U.S. Pacific territory of Guam, a major military hub and home to U.S. bombers.
US 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 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. Financial companies and department store operators were among the big decliners.
The Toronto Stock Exchange's S&P/TSX composite index unofficially closed down 143.08 points, or 0.94 percent, at 15,074.25.
"North Korea is being used as a reason to sell Japanese stocks, just as it was used yesterday in the U.S.", said Soichiro Monji from Daiwa SB Investments in Tokyo.
"European indices are following their Asian counterparts lower once more today, as the risk aversion seen over the past two days continues apace", said IG market analyst Joshua Mahony in a note. The move added to escalating U.S. Netflix also fell, giving up $2.58, or 1.4 percent, to $175.78.
A Reuters Datastream index of more than 7,000 stocks across the globe saw its market capitalization drop from a record high $61.36 trillion on Monday to $60.43 trillion at the close on Thursday. The stock lost $2.46 to $9.38. Humana rose $3.41, or 1.4 percent, to $253.63.
Outside of geopolitical concerns, disappointing company earnings and outlooks put traders in a selling mood.
Declining issues outnumbered advancing ones on the NYSE by a 2.29-to-1 ratio; on Nasdaq, a 2.47-to-1 ratio favoured decliners.
J.C. Penney Co. (JCP) slumped 17% after it reported a wider-than-expected second-quarter loss (http://www.marketwatch.com/story/jc-penney-shares-sink-after-losses-exceed-expectations-2017-08-11).
Hope that the Fed will have to slow its rate hike path appeared to stop, at least for now, the near $1-trillion loss in world stocks valuations this week triggered by the war of words between Pyongyang and the United States.
CURRENCIES: The dollar slipped to 109.98 yen from 110.06 late Wednesday in Asia.
Gold hit its highest in nearly two months after Trump added to the geopolitical anxiety by boasting of the strength of the U.S. nuclear arsenal.
The Swiss franc has gained about 1.3 percent against the dollar so far this week, while the yen has advanced around 1.5 percent in the same period. It was last up 1.1 per cent at 1.1321 per euro.
Japan's benchmark Nikkei 225 inched down less than 0.1 percent to finish at 19,729.74. Brent crude, used to price global oils, added 26 cents to $52.96.
After touching a more than two-month high, spot gold last added 0.1 percent to $1,287.18 an ounce.
"More likely than anything else, the price action was a function of an overextended US equity market that has been in need for a healthy correction off record highs", LMAX Exchange analysts said in a morning note.
US crude fell 0.41 percent to $48.39 per barrel and Brent was last at $51.68, down 0.42 percent on the day.