"Military solutions are now fully in place, locked and loaded, should North Korea act unwisely". The Japanese currency, the yen, is often a safe have asset too.
US crude oil futures settled almost 2 per cent lower at $48.59 a barrel, as Russian Federation considered a future output resumption and the Organization of the Petroleum Exporting Countries boosted its July production numbers. "We have no choice but to acknowledge the risks, and to report that financial markets are reacting to them". The euro fell to $1.1728 from $1.1757.
US Treasury yields fell to as low as 2.197 percent, their lowest level since June 28 overnight.
United States job openings jumped to a record high in June, outpacing hiring, the latest indication that companies are having trouble finding qualified workers.
For the week, the London index is looking at a 2.4% drop, which would be its biggest weekly loss since April.
Traders have been eyeing the United States volatility index (also known as the "VIX"), which is the options markets pricing of implied volatility in the S&P 500 over the next 30 days and again this has been at such subdued levels.
"Of course, it's all come at a time when share markets are due for a correction, so North Korea has provided a flawless trigger".More news: Critics are killing me in England - Morata
The euro slid 0.6 percent to 128.92 yen, and fell 0.1 percent against the dollar to $1.1735. "Pretty remarkable, perhaps even extraordinary, considering", said fund manager BlueBay strategist Tim Ash.
Trump suggested in remarks on Thursday that his comments threatening North Korea with "fire and fury" may not have been tough enough.
South Korean shares, which have been among the strongest performers in the world so far this year, fell 1 percent, while the won lost around 0.6 percent to 1,134.70 to the dollar.
The single currency slipped 0.3 percent to $1.1723 and was holding just above a July 28 low of $1.1688.
"This situation is beginning to develop into this generation's Cuban missile crisis", said ING's Robert Carnell in a morning note to clients. The Shanghai Composite added 0.08% and the Shenzhen Composite inched higher by 0.07%.
Following the sell-off seen in the previous session, stocks are regaining some ground during trading on Friday. It was down 0.2 percent at 108.96 yen, after retreating 0.7 percent on Thursday.
Crude futures meanwhile extended losses on fears of slowing demand and lingering concerns over global oversupply. Netflix lost 1.5 per cent.
United States crude oil crude futures edged up 10 cents to Dollars 48.69 per barrel. These have ranged from an investigation into Russia's possible interference in the 2016 USA presidential election, to concerns about China's risky debt levels, to stubbornly low inflation in the U.S. The Korea tensions though have seen both USA and European markets this week push back expectations of when the Fed and ECB might hike interest rates.