LONDON, Aug 11 (Reuters) - The dollar was pinned close to an eight-week low against the yen on Friday as escalating tension over North Korea dominated currency markets thinned out by the summer holidays in Europe and the United States.
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 Toronto Stock Exchange's S&P/TSX composite index fell 143.08 points to 15,074.25, with almost all of its sectors moving lower. The 6.5-magnitude quake also left more than 240 people injured.
In contrast to the USA market, global equities remained weak.
Hong Kong stocks dipped sharply at the open: Falls in China have been nearly doubled by Hong Kong's Hang Seng index, which were down by 1.2% shortly after the index opened at 11:30am AEST.
"I think the market would put it as a very low probability that this turns into anything extremely meaningful", said Scott Wren, senior global equity strategist at the Wells Fargo Investment Institute.
Against the tense backdrop, the South Korean won extended its losses on Thursday and touched its lowest level against the dollar in about a month.
Excessive fears surrounding North Korea seemed to have receded, traders say, but activity was subdued with Japanese markets closed on Friday. The Standard & Poor's 500 index dropped 1.4 percent to 2,438.21.
Brian Jacobsen, chief portfolio strategist at Wells Fargo Funds Management, said: "While the tough talk about the potential for war (between the U.S. and North Korea) is scary, investors have heard it many times before". "We want stocks to ratchet down ahead of the budget negotiations", Goldberg said. It was down 0.2 per cent at 108.96 yen, after retreating 0.7 per cent on Thursday.
Still, prices for gold remain below $1,300 an ounce "because so far there has been a lot of talk, but little action", said Cieszynski.
The single currency pared gains to 128.59 against the yen, from a high of 129.55 hit at 9:00 pm ET.
U.S. producer prices unexpectedly recorded their biggest drop in almost a year, and the number of Americans filing for unemployment benefits unexpectedly rose last week.
U.S. Treasury long-dated yields dropped to six-week lows, pressured by U.S. Shanghai's main index also tumbled 1.6 percent to 3,208.54 while Australia's S&P/ASX 200 dropped 1.2 percent to 5,693.10.
The weaker-than-expected consumer price data in July, which pointed to benign inflation, could cause the Federal Reserve to hold off from raising rates again this year.