The threat, reported by he state-run KCNA news agency, came just hours after U.S. president Donald Trump warned any threat to the USA would be met with "fire and fury". But Michael said the overall market was still expected to saw-tooth its way higher due in part to a batch of better-than-expected earnings and low interest rates, despite the shift toward raising rates.
The North Korea situation isn't the only thing weighing on stocks.
The CBOE Volatility Index, better known as the VIX and the most widely followed barometer of expected near-term stock market volatility, rose the most in about 12 weeks.The index ended up 4.93 points at 16.04, the highest level since November 8, when Trump was elected president.
In Europe, the Stoxx 600 Index finished the day with a decline of 1 percent from the previous close.
Money also flowed into consumer discretionary stocks.
In early trading, France's CAC 40 fell 1.5 percent to 5,141.37 points and Germany's DAX lost 1.2 percent to 12,144.54.
First, a wave of selling doused Asia's markets - sending Tokyo's Nikkei 225 down 1.3% and pressuring South Korea's Kospi Index to a 1.1% decline.
If the North Korean regime "does anything" to the USA or a United States ally "things will happen to them like they never thought possible", Trump told reporters on Thursday, according to Bloomberg.
Mo Farah & Usain Bolt prepare for final events
The women's 4x400m team of Zoey Clark, Laviai Nielson, Perri Shakes-Drayton and Emily Diamond qualified in second from their heat. Usain Bolt finished third in the 100 metres final earlier in the World Champs, in what was his final individual race.
Trump's comments followed reports that North Korea had successfully produced a nuclear warhead that could be fitted inside its missiles. The Nasdaq composite fell 35 points, or 0.5 percent, to 6,336.
Dow e-minis were down 24 points, or 0.11 percent, with 22,166 contracts changing hands. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 5.5 basis points at 2.228%.
The CBOE Volatility Index-a measure of investors' expectations for swings in the S&P 500 over the next 30 days-surged 44% to 16.04 Thursday-its highest level since U.S. Election Day.
Beyond geopolitical concerns, investors continued to size up company earnings reports.
Nevsun Resources Ltd offset some of the material group's gains, plunging 18.4 percent to C$2.685 after the company reported disappointing quarterly results.
Priceline Group slumped 6.5 percent after issuing a profit forecast that was weaker than analysts were expecting.
The Canadian dollar was trading at 78.64 cents U.S., down from an average price of 78.71 cents United States on Wednesday.
CURRENCY: The dollar declined to 109.77 yen from Tuesday's 110.34. Brent crude, the worldwide standard, lost 23 cents to 52.14 dollars a barrel in London. The euro edged down to $1.1727 from $1.1751.