Markets Right Now: Stocks drift lower on Wall Street

US Warns North Korea Nuclear Ambitions Will Lead To 'Destruction'

US Warns North Korea Nuclear Ambitions Will Lead To 'Destruction'

Guam, a 210 sq mile sovereign USA territory in the western Pacific Ocean, is used by the U.S. as a strategic military base. Increased geopolitical concerns between the USA and North Korea limited the S&P 500's upward movement.

Andersen Air Force Base on Guam is where the USA keeps its B1-B bombers deployed to the Asia Pacific.

"I feel that the presence of the military on Guam will help us a lot", said Virgie Matson, 51, a resident of Dededo, Guam's most populated village.

Protecting the island is the US Army's Terminal High-Altitude Area Defence, or Thaad, which is used to shoot down ballistic missiles.

The possibility of a nuclear confrontation is considered remote but worldwide alarm has been escalating in recent days.

It would be up to Kim Jong-un whether the move actually is carried out.

It was a down day for Asian stocks, as traders shied away from riskier assets amid the ongoing war of words between North Korea and the U.S. The biggest loser in the region was Hong Kong's Hang Seng, which dropped 1.1%.

Two U.S. Air Force B-1B Lancer bombers fly from Andersen Air Force Base, Guam, for a 10-hour mission, with an escort of a pair of Japan Self-Defense Forces F-2 fighter jets in the vicinity of Kyushu, Japan August 8, 2017.

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"Heightened geopolitical risks overnight have seen the markets flip from risk-on to risk-off and we have to wait and see how long this move runs before adding some positions", said Viraj Patel, an FX strategist at ING in London.

"North Korea has always threatened other countries".

There's a sense of patriotism among those who cite the island's history of Guam residents serving in the USA military.

Guam was claimed by Spain in 1565 and became a USA territory in 1898 during the Spanish-American War.

A key USA military stronghold, Guam was the departure point for US B-52 bombers that attacked Hanoi during the 1955-1975 Vietnam war.

MARKETS OVERSEAS: Major indexes in Europe were headed lower. Residents do not pay USA income taxes or vote in the general election for United States president but its natives are U.S. citizens by birth.

Guamanians have served in all major US wars since World War II and see military service as a source of pride. "About 162,000 people -- mostly United States citizens -- call the island home".

Approximately 40% of Guam's population of 162,000 is made up of the indigenous Chamorro people, while another 25% are Filipino. "And not a lot of Americans know that".

Guam lies about 3,400 kilometres (2,100 miles) from the Korean Peninsula, and it is extremely unlikely Kim's government would risk annihilation with a pre-emptive attack on U.S. citizens.

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 with a closing streak of more than 0.3%, a 90-year record.

In August a year ago, the North's Foreign Ministry warned that all US military bases in the Pacific including Guam would "face ruin in the face of all-out and substantial attack" by the North's military.

Pyongyang, meanwhile, has been louder in its complaints against a new and tough round of sanctions imposed by the United Nations, with strong U.S. backing, and Washington's use of Guam as a staging ground for its stealth bombers, which could be used to attack North Korea and are a particularly sore point with the ruling regime in Pyongyang. Jennifer Sinco Kelleher in Honolulu and Jocelyn Gecker in San Francisco contributed reporting.

McAvoy reported from Honolulu.

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