United States stocks fall again on North Korea tensions

People watch news report showing North Korea's Hwasong-14 missile launch on electronic screen at Pyongyang station North Korea

The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index fell around 1.2 percent each to finish at 5,693.10 and 5,743.50, respectively. Reuters data show a 28-percent chance for a hike after the Fed's December meeting.

The CBOE Volatility Index, a barometer of expected near-term stock market volatility, closed at its highest since the US presidential election on Thursday, but was down 1.22 points at 14.82 points on Friday. In a tweet, President Donald Trump warned of military action "should North Korea act unwisely", noting that the U.S.is "locked and loaded".

"The escalation of the geopolitical situation between the US and North Korea is beginning to rattle investors' nerves as was witnessed in the VIX index yesterday", said Peter Cardillo, chief market economist at First Standard Financial.

The U.S. equity market is hovering near record levels and volume has been tepid following the onset of summer.

Seoul shares hit 11-week low amid selling by foreign investors following Trump's fresh warning to North Korea.

The Stoxx Europe 600 Index lost 0.3 percent at 8:30 a.m.in London. The S&P has lost more than 1 percent on only three days this year. Bank of New York Mellon slid 3.9 percent, while Citizens Financial Group shed 3.8 percent.

The dollar has traded roughly between 108 yen and 115 yen in the past several months, and has support on technical charts at 108.13 yen, the low struck on April 17.

The euro edged up 0.1 percent to $1.1824.

"Pretty remarkable, perhaps even extraordinary, considering", said Tim Ash, strategist at fund manager BlueBay.

The S&P's record close on August 7 likely helped fuel its latest sell-off. (NYSE: GS) fell 2.4% and Cisco Systems Inc.

"If the data continues to come in on the softer side, the market might start to price the Fed staying on hold this year", said Sireen Harajli, FX strategist at Mizuho in NY.

The dollar index, which measures the greenback against a basket of six major currencies, held steady at 93.096, after slipping around 0.3 percent on Friday.

Sterling was last trading at $1.3009, up 0.27 percent on the day.

Australian shares fell to near three-week lows in a broad-based selloff.

USA 10-year yields inched higher after falling on Friday to six-week lows following data showing that US consumer prices rose just 0.1 per cent last month, below economists' forecast of a 0.2 per cent gain.

In the first four days of the week, the Standard & Poor's 500 index swung from marking its latest record high to posting its biggest single-day drop in almost three months.

Gold added $3.90 to settle at $1,294 an ounce.

Ongoing global glut concerns lingered in oil markets despite a bigger-than-expected draw in USA crude inventories.

Related News: