Futures markets were also pointing to a lower start for Wall Street, where missile makers have been the only significant gainers in recent days.
The producer price index for final demand edged down by 0.1% in July after inching up by 0.1% in June.
In economic news, second-quarter Singapore GDP growth was revised upwards to 2.2 percent compared to the previous quarter, above an earlier estimate of 0.4 percent growth.
After President Trump warned North Korea about dire consequences, the powers in Pyongyang were quick to respond back.
"I will tell you this, North Korea better get their act together or they're going to be in trouble like few nations ever have been in trouble in this world", Trump said. "The unpredictable nature of North Korea means it is hard to gauge exactly how likely an attack is. Hopefully Kim Jong Un will find another path!"
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The man who allegedly received the money was American citizen Mohamed Elshinawy, arrested a year ago in Maryland. Elshinawy claims he did not plan to plan to carry out an attack, and he's now awaiting trial.
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The tiny USA territory of Guam feels a strong sense of patriotism and confidence in the American military. The air base was built in 1944, when the US was preparing to send bombers to Japan during World War II.
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She eventually finds her place in a new women's wrestling show alongside her former best friend. The Gorgeous Ladies of Wrestling are set to return .
The NASDAQ Composite Index and Dow reversed their direction after President Trump's comments on North Korea.
Missile makers Raytheon and Lockheed Martin have outperformed Wall Street by nearly four per cent in recent days and the Dow Jones US defence index is at a record high and on a seven-day unbroken run of gains. Genesee & Wyoming (GWR) is posting a notable gain after reporting an increase in July traffic. The Russell 2000 index gave up 1.7 percent to 1,372.54. The index is bouncing off its lowest closing level in six months. It is set for a weekly gain of 2.4 percent.
Trucking and software stocks are also seeing notable strength in mid-day trading, while steel stocks have moved sharply lower on the day.
Apart from geopolitical worries, some technical analysts like Tom McClellan, editor of the McClellan Market Report, blamed seasonality for this week's sharp retreat given August's record as a weak month for stocks.
South Korea's KOSPI fell 1.4 percent, taking its losses this week to almost 3 percent.
With Japanese markets closed for a public holiday, Hong Kong led the downward charge in Asia-Pacific as the Hang Seng lost more than two percent. Interestingly, the Asian indices have fared better than European ones, and United States futures suggest that U.S. indices will get hit for a second day when they open later. Europe's other main indices were also in negative territory, with the Frankfurt Dax and Paris CAC 40 down by similar amounts, declining by 1.5% and 1.8% respectively. "However, geopolitically-driven moves tend not to be long lasting in markets and moves are often quickly retraced".
Dudley also cautioned that "it's going to take some time" for inflation to rise to the central bank's 2 percent target even as he offered a generally positive outlook for the US economy, job market and price pressures.