Gold soars as the U.S. and North Korea wage a verbal war

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       A Swiss franc note on display at the Swiss National Bank

U.S. President Donald Trump on Thursday warned Pyongyang again, saying his previous promise to unleash "fire and fury" may not have been strong enough after North Korea responded with a threat to fire missiles over Japan to land near the U.S. Pacific territory of Guam.

In Europe, the pan-continental STOXX 600 index lost 0.9 percent, with falls deepening after reports a vehicle had rammed a group of soldiers in Paris, injuring six.

The Dow Jones industrial average closed up 14 points, a gain of 0.07 percent, the Nasdaq composite rose almost 40 points or 0.64 percent and the S&P 500 gained 3 points or 0.13 percent.

"It's unbelievable when you consider the headlines just how calm the equity markets are, how they've taken things in their stride", said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina.

Mr. Trump's remarks on Tuesday that North Korea would face "fire and fury like the world has never seen" pushed Wall Street lower on Tuesday and drove up the VIX "fear gauge" of expected volatility on the S&P 500 higher. Pyongyang said it was examining plans for attacking Guam, a USA territory in the Pacific with a military base.

The CBOE Volatility Index .VIX , a barometer of expected near-term stock market volatility, closed at its highest since the USA presidential election on Thursday, but was down 1.22 points at 14.82 points on Friday. The VIX rose further on Wednesday, rising as far as 12.11, its highest in nearly a month. "We're not very oversold yet so the market still has more downside left to it".

The Dow Jones industrial average lost 123 points, or 0.6 percent, to 21,923.

South Korea's KOSPI fell 1.8 percent to an 11-1/2-week low, but its losses for the week are a relatively modest 3.2 percent.

Australian shares were down 1.3 percent, set for a weekly loss of 0.6 percent and Chinese and Hong Kong bluechips lost 1.6 percent and 1.9 percent respectively.

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"The typical text book trade is that investors rush for safe havens".

Traders turned towards safe-haven assets such as gold, helping the precious metal touch a two-month high, and the Japanese Yen rose.

Declining issues outnumbered advancing ones on the NYSE by a 2.29-to-1 ratio; on Nasdaq, a 2.47-to-1 ratio favored decliners.

The market was also waiting for United States inflation data on Friday that would offer clues about the extent to which the strengthening United States labour market is spilling over into inflation.

Sterling was last trading at US$1.3007, up 0.25 per cent on the day.

CURRENCIES: The euro slipped 0.1 percent to $1.1176 while the dollar was steady at 109.20 yen.

Bond prices rose. The yield on the 10-year Treasury note fell to 2.23 percent.

In a note sent to clients late on Thursday, the USA bank predicted the single currency would rise to $1.25 in the first quarter of next year and reach parity with sterling for the first time.

US crude fell 0.41 percent to $48.39 per barrel and Brent was last at $51.68, down 0.42 percent on the day.

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