Gold hovers near two-month highs on N.Korea tensions

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It ended the day at around 11, a daily gain of about 1.2.

The Dow Jones industrial average lost 204 points, or 0.9 percent, to 21,844.

The Nikkei was down 1.6 percent after North Korea said on Wednesday it is "carefully examining" plans for a missile strike on the U.S. Pacific territory of Guam, just hours after U.S. President Donald Trump told the North that any threat it presented to the United States would be met with "fire and fury".

The unease about the relationship between the US and its allies and North Korea is more prominent in other markets, several market strategists noted. "They might take profits first and wait to see what's going to happen before they move into the market again", said GoldSilver's Lan.

"They've been doing this to our country for a long time, for many years, and it's about time that somebody stuck up for the people of this country and for the people of other countries", Trump said.

"North Korea doesn't seem like they're going to back down and the United States has also made a very strong stance this time".

It was reported Tuesday the USA intelligence community believes North Korea has developed mini nuclear warheads that can be fitted into ICBMs.

The dollar index fell 0.05 percent, with the euro down 0.03 percent to $1.1746.

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Excluding food and energy prices, core producer prices still dipped by 0.1 percent in July after creeping up by 0.1 percent in June. Humana rose $4.74, or 1.9 percent, to $254.96. "Risk aversion is still very much a concern for markets", said Shaun Osborne, chief currency strategist at Scotiabank in Toronto.

Oil prices closed lower after an early rally faded.

Cempra ( CEMP ) helped to lead the biotech sector lower, extending the pullback seen over the course of the previous session. Discovery Communications fell 70 cents, or 2.9 percent, to $23.60. The index dropped to a one-month closing low. Shares of Manulife, which reported better-than-expected results, fell after the company played down talk of a John Hancock spin-off.

Major stock indexes overseas also racked up losses Thursday. Gold hit a two-month high of $1,278 an ounce amid the nervousness. US gold futures GCcv1 gained 1.63 percent to $1,283.20 an ounce.

As the second-quarter earnings season has wound down, stock-trading volumes have been relatively low - a factor that can exacerbate swings in the broader market. The FTSE 100 index of leading British shares was 0.7 percent lower at 7,489.

The major European markets also saw continued weakness on the day. "Risk aversion is still very much a concern for markets", said Shaun Osborne, chief currency strategist at Scotiabank in Toronto.The dollar index .dxy , which measures the U.S. currency against a basket of other major currencies, fell 0.14 percent.The dollar weakened after news that U.S. producer prices unexpectedly fell in July, recording their biggest drop in almost a year and pointing to a further moderation in inflation that could delay a Federal Reserve interest rate increase.U.S. Treasury long-dated yields dropped to six-week lows, pressured by U.S.

The S&P 500 slid 35.81 points, or 1.4%, to 2438.21.

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