Stocks fall for third day as U.S., N. Korea tensions rattle markets

Brewing tensions between the U.S. and North Korea put investors in a selling mood again Thursday, dragging U.S. stocks lower for the third day in a row.

The latest sell-off was the most severe yet, amounting to the biggest single-day drop for the stock market in nearly three months.

Technology companies, which have been the biggest gainers this year as the market hit a succession of record highs, led the broad slide. Banks and department store shares also were among the big decliners. Utilities eked out a small gain.

The Standard & Poor's 500 index dropped 35.81 points, or 1.4 percent, to 2,438.21. The Dow Jones Industrial Average slid 204.69 points, or 0.9 percent, to 21,844.01, just shy of its low point for the day.

The tech-heavy Nasdaq composite bore the brunt of the sell-off, losing 135.46 points, or 2.1 percent, to 6,216.87. May 17 was the last time the three indexes had a bigger single-day decline.

Smaller-company stocks also fell sharply. The Russell 2000 index gave up 24.40 points, or 1.7 percent, to 1,372.54. All the indexes are down for the week.

Wall Street got off to a downbeat start early Thursday as tensions between the U.S. and North Korea continued to escalate, rattling markets overseas.

Unease over the situation pushed the VIX, a measure of how much volatility investors expect in stocks, up 44.4 percent. That's the biggest increase since May.

Heading into Thursday, about 89 percent of the companies in the S&P 500 had reported quarterly results. Of those, 52 percent delivered earnings and revenue that beat financial analysts' forecasts, according to S&P Global Market Intelligence.

Technology stocks, the biggest gainers this year, led Thursday's market slide.

Nvidia Corp. fell $7.37, or 4.3 percent, to $164.74, while Advanced Micro Devices Inc. gave up 71 cents, or 5.5 percent, to $12.12.

Several financial sector companies also helped pull down the market. Bank of New York Mellon slid $2.09, or 3.9 percent, to $51.95, while Citizens Financial Group Inc. shed $1.32, or 3.8 percent, to $33.71.

Disappointing quarterly results from big department store chains also weighed down the market.

Macy's Inc. tumbled 10.2 percent after the company said its sales continued to decline in the second quarter. The stock lost $2.36, to $20.67. Dillard's Inc. slumped 15.9 percent after the chain booked a loss for the second quarter, as increased inventory led to big discounts. Its shares slid $11.64, to $61.70. Kohl's Corp. also declined, giving up $2.43, or 5.8 percent, to $39.50.

Benchmark U.S. crude fell 97 cents, or 2 percent, to $48.59 a barrel on the New York Mercantile Exchange.

Gold added $10.80, or 0.8 percent, to settle at $1,290.10 an ounce. Silver gained 20 cents, or 1.2 percent, to $17.07 an ounce. Copper fell 2 cents, to $2.90 a pound.

The dollar slipped to 109.26 yen from 109.85 late Wednesday. The euro rose to $1.1774 from $1.1752.