North Korea said it was considering plans to fire missiles at Guam, a US -held Pacific island, after President Donald Trump on Tuesday warned the nuclear-armed nation that it would face "fire and fury" if it threatened the United States.
Eight of the 11 major S&P sectors were lower, with the consumer discretionary index's 0.59 percent fall leading the decliners. Pyongyang said it was examining plans for attacking Guam, a US territory in the Pacific that has a USA military base.
Trump's comments sparked a late afternoon selling on Tuesday, with the Dow ending a nine-day streak of closing records. Prices for bonds and gold headed higher.
The Dow Jones Industrial Average fell 36.64 points or 0.17 per cent to end at 22,048.7, the S&P 500 lost 0.9 point or 0.04 per cent to 2,474.02 and the Nasdaq Composite dropped 18.13 points or 0.28 per cent to 6,352.33.
The Nasdaq Composite was down 16.88 points, or 0.26 percent, at 6,353.58.
Wall Street's three major indexes dipped after Trump vowed to respond aggressively to any threats from North Korea.
The back-and-forth came on the heels of reports the U.S. intelligence community has determined North Korea has successfully produced a miniaturized nuclear warhead that can fit inside its missiles.
Shares of Dow component Walt Disney were down 4.94 percent in premarket trading after the company said it will stop providing new movies to Netflix and launch its own streaming service.More news: Pinoys in Guam worry about NoKor's threat
Dow e-minis were down 35 points, or 0.16 percent, with 37,467 contracts changing hands at 8:40 a.m. ET (1240 GMT).
U.S. markets fell on Wednesday morning, spooked by rising tension between the USA and North Korea.
Shares of hotelier Marriott International slumped more than 3%, a day after the firm said it expected limited growth in North America in coming months. Travel website operator Priceline Group Inc fell 6.9 per cent after a disappointing financial forecast. Orders fell 4.7 percent from the previous quarter in April-June, suggesting demand is weaker than expected, though economists say such measures are not overly important.
Hong Kong's Hang Seng Index was off 0.09%. It rose $15.70, or 1.2 percent, to $1,277.80 an ounce.
The yield on the 10-year US Treasury note rose to 2.282% from 2.258% on Monday. Brent crude, used to price global oils, gave up 29 cents to $51.85 in London.
CURRENCY: The dollar declined to 109.79 yen from Tuesday's 110.34 yen. The mood then hit Europe, where Frankfurt's DAX dropped 1.1% and the CAC-40 in Paris fell 1.4%.
ENERGY: Benchmark U.S. crude lost 23 cents to $48.94 per barrel in electronic trading on the New York Mercantile Exchange.