US stocks saw their largest losses since May on Thursday, as tensions mounted between North Korea and the US, reports the BBC.
Pyongyang, which has threatened to fire missiles toward the US Pacific island territory of Guam, gave more details of its plans.
Meanwhile, President Donald Trump intensified his rhetoric, saying North Korea should be "very, very nervous" if it does anything to the US.
· The Dow Jones fell 0.9% to 21,844.01 and S&P 500 fell 1.5% to 2,438.21.
· The Nasdaq lost 2.1% to 6,216.87.
Markets had been bracing for a correction after weeks of trading in record territory, as strong corporate earnings fuelled optimism.
The sell-off on Thursday in the US was widespread, with the financial and consumer sectors leading the share price declines.
Investors bought up safe-haven assets such as gold, helping the precious metal touch a two-month high, and the Japanese Yen rose.
But Thursday's decline fell short of the drops seen on 17 May, when political outcry mounted over Mr Trump's dismissal of FBI director James Comey, who was investigating ties between the Trump campaign and Russia.
Richard C Marston, a professor at the University of Pennsylvania's Wharton School of business, told the BBC: "If the North Korean situation worsens ... I would expect the stock market to react negatively.
"Corporate earnings can be easily overshadowed if there is a real threat of a conflict."
Other world stock markets also saw losses, triggered by tensions between the US and North Korea.
The Euro Stoxx 50, which includes Europe's biggest companies, fell 1% while London's FTSE 100 closed down 1.4%.