The index was showing signs of Greed just two days ago while the Dow was in the midst of a winning streak that included nine straight record highs.
The Standard & Poor's 500 index fell 8 points, or 0.4 percent, to 2,466 as of 2:45 p.m.
By 3.08pm, the FTSE 100 had fallen by 121 points or 1.6% and was on track for its worst day since April, also pressured by losses in the commodity sector and disappointing British export figures.
The Nasdaq composite fell 13.31 points, or 0.2 percent, to 6,370.46.
Trump had told North Korea to not "make any more threats" to the US or the country "will be met with fire and fury like the world has never seen".
ANALYST'S TAKE: "The tensions between North Korea and the U.S.is an excuse for profit-taking", Seo Sang Young, an analyst at Kiwoom Securities. The yield on the 10-year Treasury note fell to 2.22 percent from 2.26 percent late Tuesday.
To that end, gold prices shot up to near $1,300 an ounce - their highest level in several months.
The S&P 500 index had its biggest one-day drop in nearly three months on Thursday as investors fled riskier assets, with technology stocks leading the charge, in response to an increasingly aggressive exchange of threats between the United States and North Korea. Twenty-First Century Fox gave up 46 cents, or 1.6 percent, to $27.57.
Computer hardware, semiconductor, and retail stocks are also seeing considerable weakness, while gold stocks are among the few groups bucking the downtrend.
Shares of Walt Disney were down 4.23 per cent, the biggest drag on Dow, as investors doubted whether the company can succeed with its plan to launch its own streaming services rather than rely on Netflix to reach online viewers.
On the currency markets, sterling rose 0.2% to flit around the 1.30 USA dollar mark, with the greenback falling in response to the latest U.S. inflation data.
The market indexes wavered between small gains and losses for much of the morning, then veered lower by afternoon.
Bond prices were little changed.
Separately, US producer prices unexpectedly fell in July, recording their biggest drop in almost a year, weighed down by declining costs for services and energy products.
Focusing on United Kingdom stocks, Old Mutual was among the biggest fallers after saying it was taking a "cautious" approach to the dividend despite hiking half-year profits. Hong Kong's Hang Seng added 0.6%.
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.
MARKETS ABROAD: In Europe, Germany's DAX rose 0.3%, and France's CAC 40 gained 0.2%. Copper rose 4 cents to $2.94 a pound.
CURRENCIES: The dollar fell to 109.96 yen from 110.48 yen late Tuesday.
Defense Secretary James Mattis said during a August 11 press conference that a war with North Korea would be "catastrophic". Mattis' comments follow President Donald Trump's threats against the rogue nation, according to CNN.
German Chancellor Angela Merkel added: 'I don't see a military solution and I don't think it's called for. "No, I don't think so". Johnson added that the North Korean government was responsible for the crisis and "must fix it".
Kirsty split from her rugby ex four years ago and said that for a while she was anxious about how her kids had taken the break up. A source told The Sun on Sunday Kirsty had enjoyed a night out and went to pick up her children from her ex-husband's home.
Kayley spent 13 hours in untangling all the hair of the girl and gave her a new life, a new-found confidence. But, even better than that, the cut went down a treat with the one person who really matters: the girl.
During his four years at the Camp Nou, Neymar won two La Liga titles, the Champions League and three Copas del Rey. I know that he has his reasons, they could be financial, or it could be to be the best player in the world.
So it's safe to say that you are not losing out too much by going with a refurbished product to save a few bucks. But we couldn't find the 15-inch 2017 MacBook Pro being listed on the refurbished store just yet.
Sanchez joined the team late this summer, following an extended tour of duty with Chile in the Confederations Cup. Indeed he truly is a significant loss, and right now the Gunners can not afford too many more of those.
Internet services have been blocked in Badgam district following the identification of Itoo among the slain militants. Locals tried to hamper the counter-insurgency operation but police prevented them from going near the encounter spot.
Ultimatum de la Roma pour Mahrez — Leicester
Les dernières déclarations de Craig Shakespeare sur Riyad Mahrez ne portent pas à croire que le joueur quitte Leicester cet été. Nous avons transmis une offre de 30 millions d'euros avec des bonus, soit la plus grosse offre dans l'histoire du club.
À 93 ans, il fugue pour retrouver sa petite amie
La famille du nonagénaire alerte alors les gendarmes et leur communique une description relativement complète. L'homme est ainsi vêtu d'un jean, d'un gilet sans manche de couleur bleu et d'une casquette.