"Trump's response was aggressive and that's why the (stock) market turned lower", said Ken Polcari, director of the NYSE floor division at O'Neil Securities.
Yields on core government debt fell.
USA stock index futures fell, with the S&P 500 indicated to open down 0.4 percent after share prices fell in Europe and Asia.
TECH SLIDE: Losses among technology stocks led the market slide.
Japan said on Tuesday it was possible that North Korea had already developed nuclear warheads and warned of an acute threat posed by its weapons programmes as Pyongyang's continues missile and nuclear tests in defiance of United Nations sanctions.
The euro was 0.18 percent lower against the greenback but remains the best-performing G10 currency so far this year with gains of more than 11 percent against the dollar. Eastern. The Dow Jones industrial average rose 0.1%, to 22,130.
The Nasdaq composite lost 13.31 points, or 0.2 percent, to 6,370.46.
Oil prices edged higher after a report showed US refineries processed record amounts of crude in the latest week, eating into inventories, although a surprise jump in gasoline stockpiles limited gains.
"Yesterday's flare up felt a little different initially probably more so because of the inexperience of President Trump in the area of foreign policy, particularly given his tendency to conduct policy by way of tweet and press conference", says CMC Markets analyst Michael Hewson.
Gold rose 0.6% to $1,268 (£976) an ounce and platinum gained 0.6% to reach $972.95 an ounce, having hit its highest since April at $979.
"Amid tensions in the global arena, it's hard to seek higher prices ahead of three days of holidays", Kawaguchi said.
MSCI's main index of Asia-Pacific shares, excluding Japan, was last down 0.6 percent. Netflix was down 1.8 percent. The yield on the 10-year Treasury note rose to 2.27% from 2.26%. Gold producers Randgold Resources and Fresnillo gained 1.9% and 2%, respectively, as gold prices leapt almost 1% to $1,273.30 an ounce.
Gold royalty and streaming company Franco Nevada Corp jumped 4.6 percent to C$96.27 after reporting quarterly results late on Tuesday. Instead, the Japanese yen is now picking up steam against the USD, trading under ¥110 to the dollar for the first time since June.
Oil prices rose before a report expected to show USA crude stocks fell for a sixth week. The euro held steady at $1.1752.
Aug 10 (Reuters) - U.S. stocks fell sharply on Thursday, with the Dow slipping more than 100 points, as lackluster results from retailers Macy's and Kohl's added to investor nervousness over escalating tensions between the United States and North Korea.
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