Political tensions continue to weigh on stocks

FTSE 100 preview Geopolitical worries to pressure index

But Wall Street is wondering whether the sell-off is due to North Korea - or just a widely anticipated pullback?

"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 Standard & Poor's 500 index fell 7 points, or 0.3 percent, to 2,467. The Nasdaq Composite dropped 40.64 points, or 0.64 per cent, to 6,311.70.

Trump had told North Korea to not "make any more threats" to the USA or the country "will be met with fire and fury like the world has never seen".

In other news, United States wholesale inflation dropped in July, the first contraction in almost a year and another data point that could weaken the case for the Federal Reserve to raise the benchmark interest rate again later this year.

Trump speaks with Guam's governor in extremely candid phone call
Trump also said the nation's nuclear arsenal is in "in tip-top shape" and getting stronger. Trump opened the conversation by telling Calvo, " Good morning, good morning.

The Dow Jones industrial average lost 50 points, or 0.2 percent, to 22,032.

Six out of the S&P 500's 11 major sectors closed positive on August 9.

Small-company stocks fell more than the rest of the market Wednesday. A U.S. Navy destroyer sailed within 12 nautical miles of an artificial island built up by China in a challenge to Beijing's territorial claims, officials told Reuters.

ANALYST TAKE: "Equities look set to end this week on a downer, as geopolitical uncertainty regarding North Korea shakes volatility from its 2017 slumber", said Mike van Dulken, head of Research at Accendo Markets.

The market indexes wavered between small gains and losses for much of the morning, then veered lower by afternoon.

Swiss franc, yen rise as North Korea tensions brew
In the wake of the USA and North Korea tension Wall Street , Asian markets and European markets have all closed in red territory. The UK blue-chip index closed 113 points, or 1.5%, lower at 7,385, steadily losing ground as the trading session wore on.

The CBOE Volatility Index, a barometer of expected near-term stock market volatility, closed at its highest since the USA presidential election on Thursday, but was down 1.22 points at 14.82 points on Friday.

North Korea responded to the threat with a warning of their own saying it was "carefully examining" the idea of a missile strike in Guam, a U.S. Pacific territory. The stock fell another 2 cents, or 0.4%, to 5.12 Friday.

Shares of Manulife, which reported better-than-expected results, fell after the company played down talk of a John Hancock spin-off.

While gold, a safe-haven favorite, pared some gains, it was last up 1.2 percent, at around its highest since mid-June.

OIL: Benchmark U.S. crude lost 24 cents to $48.37 per barrel on the on the New York Mercantile Exchange while Brent crude, used to price worldwide oils, declined 20 cents to $51.70 per barrel in London.

Manchester City at Brighton & Hove Albion, 2017 Premier League: Players to Watch
The 27-year-old England worldwide impressed last season as he helped Spurs reach a successive second placed finish. We have a lot of quality here and that is going to help the team. "We are here to win the games.

S&P 500 e-minis were up 1.5 points, or 0.06 percent, with 300,073 contracts traded. Yields fall when bond prices rise.

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