Markets Right Now: US stocks trade lower at midday

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"More likely than anything else, the price action was a function of an overextended USA equity market that has been in need for a healthy correction off record highs", LMAX Exchange analysts said in a morning note.

South Korea's Kospi fell more than 1%, while Japan's Nikkei 225 dipped 0.26%.

The so-called fear gauge - the CBOE Volatility Index (VIX), the most widely followed barometer of expected United States stock market volatility, hit its highest since November 8, when Mr Trump was elected president.

Safe-haven assets gained following the rising geopolitical tensions.

Dow e-minis were down 24 points, or 0.11 percent, with 22,166 contracts changing hands.

President Donald Trump said Friday that the USA military was "locked and loaded", while Pyongyang accused him of driving the Korean peninsula to the brink of nuclear war. North Korea also laid out detailed plans of how it would launch a missile strike on USA military bases in Guam.

Trucking and software stocks are also seeing notable strength in mid-day trading, while steel stocks have moved sharply lower on the day.

The benchmark BSE index closed down by 317.74 points or 1.01 per cent at 31,213.59, its lowest close in over a month.The broader NSE index ended lower by 109.45 points or 1.11 per cent at 9,710.80. It has been more than a year since the last 5% downdraft in stocks and more than 76 weeks since the stock market suffered a 10% loss.

Meanwhile, market bellwether Samsung Electronics Co. fell 0.82 percent to 2,295,000 won, and top automaker Hyundai Motor was down 0.68 percent to 145,000 won.

"Trump's response was aggressive and that's why the market turned lower", said Ken Polcari, a director at O'Neil Securities.

Overnight, Wall Street closed sharply lower after Trump, with fiery rhetoric, warned Pyongyang against attacking Guam or U.S. allies after it disclosed plans to fire missiles over Japan to land near the U.S. Pacific territory.

At the close trading in NY, the Dow Jones Industrial Average was down 204.69 points, or 0.9%, to 21,844.01, its biggest one-day fall since May 17.

The Dow slid as declines in Apple and Goldman Sachs, down 2.3% and 1.7% respectively, outweighed gains in McDonald's and Coca-Cola, up 1.4% and 0.5% respectively.

The dollar pulled back against the euro and other currencies after the Consumer Price Index rose a tame 0.1 percent in July.

Gold prices traded at their highest level in more than two months Thursday, adding to the previous session's sharpest daily rise since the middle of May, as simmering North Korean tensions underpinned haven investments.

SeaWorld Entertainment shares lost more than 6 percent.