Futures lower as North Korea tensions linger

What to watch in markets this week: North Korea, retail earnings ... oh, and the Fed

What to watch in markets this week: North Korea, retail earnings ... oh, and the Fed

Stocks took a hit for a third straight day Thursday as North Korea's nuclear threats seemed again to roil the markets.

When Japanese traders get back to their desks Monday, stocks will need to catch up with Friday's regional weakness and the yen's recent gains against the dollar.

Tensions with North Korea appear to have finally shaken the confidence of USA investors, after the S&P 500 opened 0.8% lower, threatening to end its 15-day streak of closing moves below 0.3%, a 90-year record.

The S&P 500 index had its biggest one-day drop in nearly three months on Thursday as investors fled riskier assets, with technology stocks leading the charge, in response to an increasingly aggressive exchange of threats between the United States and North Korea.

"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.

Efforts by the USA to dial down rhetoric have failed to shift the bearish mood among investors.

That marks the sixth straight trading day of declines for the loonie against a strengthening greenback.

Tillerson's tone was in sharp contrast to that of USA president Donald Trump, who warned on Tuesday any North Korean threat to the USA would be met with "fire and fury".

The S&P fell as much as 0.52 per cent at its session low.

The CBOE Volatility Index .VIX , a barometer of expected near-term stock market volatility, closed at its highest since the election.

Japanese financial markets will be closed Friday for a national holiday.

The Dow Jones Industrial Average fell 70.4 points, or 0.32 per cent, to 22,014.94, the S&P 500 lost 5.51 points, or 0.22 per cent, to 2,469.41 and the Nasdaq Composite dropped 31.19 points, or 0.49 per cent, to 6,339.27.

At 8:30 a.m., data are expected to show consumer prices rising 0.2% in July following steady prices in June, according to data compiled by Econoday. He also said the nuclear-armed nation should be "very, very nervous" if it even thinks about attacking the United States or its allies. These have ranged from an investigation into Russia's possible interference in the 2016 United States presidential election, to concern about China's risky debt levels, to stubbornly low inflation in the US.

Six of the 11 major S&P sectors were higher, with technology's 0.80-percent rise leading the advancers. That's the index's lowest level in two months.

The major European markets are also extending a recent move to the downside. Hong Kong's Hang Seng Index plunged by 2 percent, while South Korea's Kospi Index slumped by 1.7 percent. They have soared more than 2% in the previous two sessions, and are set for a weekly gain of 2.25%.

Technology companies were leading a broad slide in USA stocks in early trading Thursday as investors pored over the latest batch of corporate earnings reports. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, dipped by 2.3 basis points to 2.189 percent. Macy's was down 4.4 percent after the company said its sales continued to decline in the second quarter.

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