Asian stocks drop due to growing concern over North Korea

TOKYO - Asian stocks are mostly lower as investors ponder escalating tensions over North Korea's nuclear ambitions.

KEEPING SCORE: Japan's benchmark Nikkei 225 slipped 0.2 per cent to 19,705.96. Australia's S&P/ASX 200 edged up 0.2 per cent to 5,779.20, while South Korea's Kospi fell 1.1 per cent to 2,342.19. Hong Kong's Hang Seng dipped 1.6 per cent to 27,314.74. The Shanghai Composite slipped 1.1 per cent to 3,240.69.

NORTH KOREA: U.S. President Donald Trump warned North Korea of "fire and fury" this week in response to recent threats from Pyongyang, which said it was examining plans for attacking Guam, a U.S. territory in the Pacific with a military base. Trump's comments followed reports the North has mastered a technology needed to strike the United States with a nuclear missile.

WALL STREET: Investors' unease over such escalating tensions weighed on stocks earlier in the day, although that settled by the end of the day. The Standard & Poor's 500 index was nearly flat at 2,474.02. The Dow Jones industrial average slid 0.2 per cent to 22,048.70. The Nasdaq composite lost 0.3 per cent to 6,352.33.

THE QUOTE: "Risk-averse sentiment is dominating global equities markets, and U.S. indices have retraced from record levels over the last two days. Although it is considered highly unlikely that this tension will escalate into a nuclear war, the market still needs to see how President Trump will eventually deal with his advocating 'fire and fury' against North Korea's threat," said Margaret Yang Yan, market analyst at CMC Markets Singapore.

JAPAN MACHINERY DISAPPOINTS: Orders for machinery in June, considered a leading economic indicator, were slower than analysts had forecast and at their weakest since May 2016. Orders fell 4.7 per cent from the previous quarter in April-June, suggesting demand is weaker than expected, though economists say such measures are not overly important.

ENERGY: Benchmark U.S. crude gained 1 cent to $49.57 a barrel in electronic trading on the New York Mercantile Exchange. It added 39 cents to $49.56 a barrel overnight. Brent crude, used to price international oils, added 4 cents to $52.74.

CURRENCIES: The dollar slipped to 110.00 yen from 110.06 late Wednesday in Asia. The euro fell to $1.1735 from $1.1757.

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