Stocks slide on continued concern over tension between U.S. and North Korea

Asian and US equities were hit by the escalating geopolitical tensions

Asian and US equities were hit by the escalating geopolitical tensions

On Thursday, the CBOE Volatility Index, a barometer of expected near-term stock market volatility, closed at its highest since the U.S. presidential election.

If the North Korean regime "does anything" to the USA or a United States ally "things will happen to them like they never thought possible", he told reporters on Thursday, according to Bloomberg.

At the close trading in NY, the Dow Jones Industrial Average was down 204.69 points, or 0.9%, to 21,844.01, its biggest one-day fall since May 17. "When earnings are not beating expectations there's a sell off in the companies, and we're just not seeing that money reinvested because of the geopolitical risks".

Nasdaq 100 e-minis were down 17 points, or 0.29 percent, on volume of 36,232 contracts.

"It's incredible when you consider the headlines just how calm the equity markets are, how they've taken things in their stride", said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina.

Even so, Wall Street remains near record highs.

"It gives them nearly a mental excuse to sell".

The headlines about North Korea served as a spark to jolt investors out of complacency on the heels of an extended period of calm in the market, said McClellan who shared the following chart in a report.

"Although we certainly can get a 5 to 7 percent correction, we don't think it's the start of a significant bear market", Peterson noted.

The CBOE Volatility Index, the most widely followed barometer of expected near-term stock market volatility, ended at a session low of 11.11 after rising as high as 12.63.

The Dow slid as declines in Apple and Goldman Sachs, down 2.3% and 1.7% respectively, outweighed gains in McDonald's and Coca-Cola, up 1.4% and 0.5% respectively. It has been more than a year since the last 5% downdraft in stocks and more than 76 weeks since the stock market suffered a 10% loss. And Blue Apron shares dipped after its first earnings report as a public company.

The latest U.S. economic data cemented expectations that inflation will remain subdued amid a robust labour market.

The Labor Department said on Friday its Consumer Price Index edged up 0.1% in July, which was below the 0.2% rise expected by economists polled by Reuters.

"Another twist of the screw tighter for this labour market but inflation is not able to gain a foothold in this economy", Chris Rupkey, chief economist at MUFG in NY, told Reuters.

The Russian dollar-traded index RTS was down 1.49 percent, and ruble-traded MICEX fell 1.29 percent by midday.

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