In New York, the Dow Jones industrial average plunged 204.69 points to 21,844.01, while the S&P 500 index dropped 35.81 points to 2,438.21 and the Nasdaq composite index slid 135.46 points to 6,216.87. The Standard & Poor's 500 index fell 0.2 per cent, to 2,474.92. The Nasdaq composite lost 0.3 percent to 6,352.33. North Korea said today it plans to fire four missiles near the U.S. territory of Guam in the Pacific Ocean, branding President Trump's warning that North Korean threats will be met with "fire and fury" as "a load of nonsense". May 17 was the last time the three indexes had a bigger single-day decline.
"At least in this segment, investors apparently remain reluctant to seek gold's safe haven".
The ongoing standoff between North Korea and America has seen gold rise to a two-month high.
Flight-to-safety moves pushed up the value of classic assets perceived as safe, including the franc, the Japanese yen and gold prices after North Korean leader Kim Jong Un made an explicit threat to strike a USA military base in Guam.
On Thursday the greenback had shed 0.8 per cent versus the yen, with the Japanese currency rallying broadly against most major currencies. It hit a 15-month low of 92.548 on August 2.
Australian shares were down 1.3 percent, set for a weekly loss of 0.6 percent and Chinese and Hong Kong bluechips lost 1.6 percent and 1.9 per cent respectively.
Instead, investors turned to assets that tend to benefit in times of geopolitical and financial stress.
The market jitters gave investors an opportunity to pocket some of their recent gains following a string of record highs fueled by strong corporate earnings.
Traders will also get the opportunity to respond to fresh US consumer inflation data on Friday.
In Paris, Engie fell 1.12 percent on reports that it is in talks to purchase a wind power project in Brazil.
Concerns over geopolitical risks probably led investors to pare back bearish bets against the yen and the Swiss franc, said Satoshi Okagawa, senior global markets analyst for Sumitomo Mitsui Banking Corporation in Singapore, referring to the gains in those currencies on Wednesday.
The dollar index .DXY fell 0.32 percent, with the euro up 0.42 percent to $1.1819. Kohl's said net income for the second quarter was $208 million, or $1.24 per share, versus $140 million, or 77 cents per share, in the same period a year ago.
Yields on core government debt fell.
ASIA'S DAY: Tokyo's Nikkei 225 tumbled 1.3 per cent to 19,738.71 and Seoul's Kospi fell 1.1 per cent to 2,368.39. The euro rose to $1.1774 from $1.1752.
General Kim Rak Gyom, the head of the country's strategic forces, declared that Trump was "bereft of reason", in a statement that could rile the U.S. president.
The dollar was testing the 109 yen barrier in morning forex trade, while gold, another classic safe haven asset, was trading at around $1,285 per ounce, up more than two percent this week. The move added to escalating U.S. Brent crude, used to price worldwide oils, gained 10 cents to $52.24 in London.