United States stocks tumble on North Korea worries

The Nikkei slumped to its lowest three-month close following US President Donald Trump’s apocalyptic North Korea warning. Reuters

The Nikkei slumped to its lowest three-month close following US President Donald Trump’s apocalyptic North Korea warning. Reuters

Oil prices rose before a report expected to show USA crude stocks fell for a sixth week.

Many world stock markets have hit record or multi-year highs in recent weeks, leaving them vulnerable to a selloff, and the tensions over North Korea have proved to be the trigger.

The market slide accelerated slightly in the last half-hour of trading as President Donald Trump denounced North Korea's nuclear program.

FED WATCH: Investors looked ahead to an appearance Thursday by Bill Dudley, president of the U.S. Federal Reserve Bank of NY, for signs of the Fed's outlook on the economy. Ten-year US yields dropped 4 basis points to 2.242 percent US10YT=RR and German equivalents fell 3 bps to 0.43 percent DE10YT=TWEB, a six-week low. The stock fell $1.01 to $22.02.

Politics lifted US defence stocks. Lockheed Martin, Raytheon, General Dynamics and Northrop Grumman all rose and the Dow Jones US defence index was up 1.6 per cent after hitting a record high. The Nasdaq composite lost 39 points, or 0.6 percent, to 6,331.

In Europe, equities dived with London losing 0.6 percent, while Frankfurt shed 1.1 percent and Paris fell 1.4 percent. Economists had expected prices to rise by 0.2 percent.

The yield on the 10-year U.S. Treasury note fell to 2.211%, according to Tradeweb, from 2.246% on Wednesday as prices rose.

In overseas trading, stock markets across the Asia-Pacific region saw continued weakness during trading on Friday.

"Sound dialogue is not possible with such a guy bereft of reason and only absolute force can work on him", a report by the North's state-run KCNA news agency said of Trump.

President Trump took aim at North Korea again on Thursday, saying that his earlier threat to unleash "fire and fury" may not have gone far enough. Dillard's slumped 15.5 percent after the chain booked a loss for the second quarter as increased inventory led to big discounts. The stock fell $3.30 to $30.09.

US missile makers Raytheon and Lockheed Martin have outperformed Wall Street by nearly 4 percent in recent days. The stock fell 85 cents to $12.76.

Retailers were all under pressure after Macy's and Kohl's each reported lower second-quarter sales, reviving worries about consumer discretionary stocks.

Chip maker Nvidia, which is expected to report earnings after the close, fell around 3% and was one of the biggest decliners in the S&P 500 tech sector.

In commodities trading, U.S. crude oil was wallowing around $49 to the barrel amid speculation that a predicted gain in American output will offset OPEC-led efforts to trim a global glut. Markets had sold off then after House leaders pulled their health care bill before a crucial vote. Its shares slid $9.77, or 5.3 percent, to $174.02.

In commodities, US. crude fell 0.67 per cent to $49.23 per barrel and Brent was last at $52.58, down 0.23 per cent on the day. Brent crude, used to price worldwide oils, added 21 cents to $52.91. Wholesale gasoline was little changed at $1.62 a gallon, heating oil rose 2 cents to $1.65 a gallon and natural gas rose 6 cents to $2.88 per 1,000 cubic feet. Natural gas gained 2 cents to $2.82 per 1,000 cubic feet.

Earlier in the session, it marked its highest since 8 June at $1,288.92 an ounce.