US stocks fell sharply on Thursday, with the S&P falling 1 percent and the Nasdaq sliding 1.5 percent, hurt by investor nervousness over escalating tensions between the United States and North Korea and lackluster results from retailers Macy's and Kohl's.
Tillerson's tone was in sharp contrast to that of USA president Donald Trump, who warned on Tuesday any North Korean threat to the U.S. would be met with "fire and fury".
Trump followed his warning with a tweet on Wednesday about the strength of the American nuclear arsenal, but expressed hope it would not need to be used.
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.
Mounting tensions lifted USA defense stocks.
On the currency markets, the pound was down to a three-week low against the United States dollar but mainly due to earlier disappointing output and trade data.
European stock markets fell further in opening trade on Friday on intensifying fears over North Korea, dealers said.
"Geopolitics splashed cold water on the markets", said J.J. Kinahan, chief strategist at TD Ameritrade.
At 10:57 a.m. ET (1457 GMT), the Dow Jones Industrial Average .DJI was up 54.38 points, or 0.25 percent, at 21,898.39, the S&P 500 .SPX was up 8.69 points, or 0.35 percent, at 2,446.90. Any gain on Tuesday would push the streak of records to 10, something that's only happened four other times since the Dow was established in 1896, according to Bespoke Investment Group.
On the currency markets, the pound edged 0.2% lower versus the USA dollar at 1.298, as traders responded to another tranche of lacklustre data from the United Kingdom economy.
Trump Claims Undue Credit for Revamping Nuclear Arsenal
This morning , North Korea said it was "carefully examining" a plan to strike the U.S. territory of Guam with ballistic missiles. And he insists his administration has "done a lot of modernization" and "a lot of renovation" already.
South Korea's Kospi stock market index has fallen by 0.4% today, adding to the 1% wiped off shares on Wednesday.
"Despite all this, there's no reason to press the panic button".
In defence of Trump's comments he said, "What the president is doing is sending a strong message to North Korea in language that Kim Jong Un would understand, because he doesn't seem to understand diplomatic language [.] I think it was important that he deliver that message to avoid any miscalculation on their part".
The Nasdaq Composite Index climbed 39.68 points, or 0.6%, to close at 6,256.56.
Consumer-focused companies and banks were among the biggest decliners. Britain's FTSE 100 added 0.1 percent.
Germany's DAX was flat, while France's CAC 40 fell 1.1 percent.
The data comes amid tepid inflation that has remained below the Federal Reserve's 2 percent target, despite low unemployment.
Office Depot tumbled 22.4 percent after the office supplies retailer's quarterly results came in below estimates.
Declining issues outnumbered advancing ones on the TSX by 164 to 80, for a 2.05-to-1 ratio on the downside.
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