"The escalation of the geopolitical situation between the US and North Korea is beginning to rattle investors' nerves as was witnessed in the VIX index yesterday", said Peter Cardillo, chief market economist at First Standard Financial. The Russell 2000 index of smaller-company stocks gave up 4.02 points, or 0.3 percent, to 1,410.15.
Materials was the only gainer among the index's 10 main sectors.
Coupled with a continued simmering tension between the USA and North Korea, that trio of data led to another positive day for safe haven currencies such as the Japanese yen and Swiss franc (CHF). USA gold futures for December delivery was mostly unchanged at $1,290.50 per ounce.
The Dow Jones Industrial Average .DJI rose 14.31 points, or 0.07 percent, to end at 21,858.32, the S&P 500 .SPX gained 3.11 points, or 0.13 percent, to 2,441.32 and the Nasdaq Composite .IXIC added 39.68 points, or 0.64 percent, to 6,256.56. The S&P 500 lost 10.71 points, or 0.43 per cent, to 2,463.31. Gold rose 1.2 per cent, while the Swiss franc was on track to post its biggest single day rise in about two-and-a-half years.
"The yen is the big story really".
The MSCI World index slipped 0.15%, extending Thursday's 1.1% drop, its biggest one-day slide since May 17.
Mike van Dulken, head of research at Accendo Markets, said: "Equities are nursing losses thanks to an unwelcome escalation in geopolitical tensions between the U.S. and North Korea, both trading nuclear threats that have awoken volatility from its slumber and seen risk assets shunned in favour of the traditional safe havens".
"There are four more (inflation) prints between now and the December FOMC meeting and we expect the Fed to remain data-dependent, if a touch more cautious", TD Securities said in a research note.
The damage inflicted on world stocks this week by the escalating war of words over North Korea topped $1 trillion on Friday, as investors again took cover in the yen, the Swiss franc, gold and government bonds.
U.S. Treasury long-dated yields dropped to six-week lows, pressured by U.S.
On Thursday, the CBOE Volatility Index, a barometer of expected near-term stock market volatility, closed at its highest since the USA presidential election.
Tensions spiked yet further when North Korean state media later said Pyongyang was considering strikes near U.S. military installations in Guam.
Spot gold prices were little changed at $1,286.05/oz, after touching a two-month high earlier. The slide deepened after Trump's remarks on North Korea aired.
"There is genuine concern, hence the fall in the dollar and the rise in VIX".
Gold and other precious metals made strong gains. Oil also regained momentum as data pointed to declining US inventories.
There have been some markets which have benefited from the U.S. We suspect that like yesterday, North American participants are likely to unwind some of the anxiety-led price action.
Excluding food and energy prices, core consumer prices still crept up by 0.1% in July, matching the increases seen in the three previous months.
Despite the drop, analysts said the market seemed to be a bit sceptical that the North Korea situation would grow into a major crisis, noting that the losses were still not that deep.