US stocks rose Friday but still notched their biggest weekly loss in months, as investors were shaken by disappointing earnings results and an escalation of threats between the USA and North Korea.
Shane Oliver, head of investment strategy at AMP Capital in Sydney, said: "What has changed this time is that the scary threats and war of words between the USA and North Korea have intensified to the point that markets can't ignore it".
"As a portfolio manager, you say, 'Do I think we'll get a war out of this?'" said Torsten Slok, chief global economist at Deutsche Bank, referring to the back and forth between North Korea and President Donald Trump.
The U.S. blue-chip index is down 1.1% this week and the S&P 500 is 1.6% lower, facing its worst weekly performance since November.
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. The move added to escalating U.S.
Stocks are falling in midday trading on Wall Street, led by declines in technology companies and banks.
Mr. Trump's remarks on Tuesday that North Korea would face "fire and fury like the world has never seen" pushed Wall Street lower on Tuesday and drove up the VIX "fear gauge" of expected volatility on the S&P 500 higher. Advanced Micro Devices gave up 38 cents, or 3 per cent, to $12.45.
Macy's slumped 10 percent after reporting its 10th straight decline in a key sales measure. On the Nasdaq, 1 378 issues rose and 892 fell.
Korea's Samsung Electronics fell 2.8% Friday and was down 6.1% on the week. Kohl's also declined, sliding $3.08, or 7.3 per cent, to $38.85.
BONDS: Bond prices rose. On Thursday, fellow newly public company Blue Apron Holdings lost 18% after the meal-kit maker reported rising costs amid increased competition. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2 basis points at 2.192 percent.
The Federal Reserve's hint about unwinding balance sheets, the possibility of the European Central Bank tapering stimulus and the looming debate about the USA debt ceiling in the fall challenge the market's recent performance, Mr. Baele said. South Korea's Kospi fell 0.5 per cent. Australia's S&P/ASX 200 edged down almost 0.1 per cent. While the German DAX Index closed just below the unchanged line, the U.K.'s FTSE 100 Index and the French CAC 40 Index both tumbled by 1.1 percent.
CURRENCIES: The dollar slipped to 109.35 yen from 109.85 late Wednesday.
The local currency closed at 1,143.50 won against the US dollar, down 1.50 won from the previous session's close.
MARKETS OVERSEAS: Major indexes in Europe were headed lower.