Dow falls more than 100 points as North Korea tensions linger

US stocks open lower as North Korea tensions linger
US stocks open lower as North Korea tensions linger  

U.S. equities fell on Thursday as tensions between the United States and North Korea persisted.

The Dow Jones industrial average (Dow Jones Global Indexes: .DJI) fell about 130 points with Goldman Sachs and Apple contributing the most losses.

The S&P 500 (^GSPC) declined 0.8 percent, with information technology and financials leading all sectors lower. The Nasdaq composite (^IXIC) pulled back 1.2 percent, with Apple, Alphabet, Amazon and Netflix all trading lower.

The CBOE Volatility Index (VIX) (^VIX), widely considered the best gauge of fear in the market, soared more than 33 percent to trade at 14.80.

Earlier this week, President Donald Trump said that North Korea would face " fire and fury " if it continued to threaten the States, however North Korea has dismissed these warnings by the U.S. incumbent as a " load of nonsense ."

The iShares MSCI South Korea capped exchange-traded fund (EWY), which tracks South Korean stocks, fell 1.7 percent Thursday.

Traditional safe havens have seen solid inflows as tensions have increased. Gold futures have risen nearly 2 percent this week, while the Swiss franc has advanced 0.7 percent against the U.S. dollar.

"We're through most of the earnings season and the valuations [in the stock market] become a bit problematic when you have something like North Korea come up," said Maris Ogg, president at Tower Bridge Advisors.

Equities, meanwhile, have slipped across the world but hadn't posted a meaningful pullback since the two nations started taking verbal jabs at each other.

The S&P was only down 0.1 percent for the week entering the session. In Europe, the Stoxx 600 index has fallen 1.2 percent for the week.

"Our assumption is that the 'battle of the bombasts' will remain verbal for the foreseeable future and that Guam will drop out of the headlines as quickly as it has been inserted into them," Michael Shaoul, chairman and CEO of Marketfield Asset Management, said in a note.

"It remains possible that we will see another brief lurch downwards, particularly in the technology sector that seems to be the locus of hedging activity, but the chances of this developing into a meaningful correction still looks remote at the current time," Shaoul said.

Investors also kept an eye on tech stocks, as the year's best-performing sector dropped more than 1 percent.

The sector "seems a little crowded," Darrell Cronk, president at Wells Fargo Investment Institute, told CNBC's "Squawk on the Street." "When you look at active managers' positioning today, they are 30 percent over-positioned to a historical norm."

Wall Street also turned its eyes to retail earnings, as Macy's and Kohl's both reported better-than-expected quarterly results. Dillard's, however, posted much weaker-than-expected results, sending the stock down 15 percent.

Calendar second-quarter earnings have been mostly better than expected, with growth surpassing initial expectations and most S&P 500 companies topping profit and sales estimates.

The positive earnings helped lift U.S. stocks to record highs. Last week, the Dow broke above 22,000 for the first time.

-CNBC's Alexandra Gibbs contributed to this report.


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