Trump issued a new tweet-warning to Pyongyang on Friday: "Military solutions are now fully in place, locked and loaded, should North Korea act unwisely".
North Korea said it was completing plans to fire four intermediate - range missiles over Japan to land near the U.S. Pacific island territory of Guam.
The yen has also registered its biggest weekly gain since May against the dollar amid speculation that investors of Japan, as the biggest creditor nation, would repatriate their funds should a war break out. "North Korean tensions continue to escalate", leaving the Swiss Franc, and possibly the USA dollar, as the remaining beneficiaries of risk aversion, Emmanuel Ng, currency strategist at OCBC Bank in Singapore, wrote in a note. Two weeks ago it saw its biggest weakly fall against the euro since the start of 2015. It was on course for a weekly rise of about 5%, the biggest such gain since July 2016.
"There is a low probability that we will have a war with North Korea", he said, and a larger pullback in stocks is "a buyable drop".
Singapore's DBS bank added in a statement that the yen "remains the safe haven currency from the sabre-rattling between US President Donald Trump and North Korea". "But with the rhetoric having gone to a different level, the market just can't afford to take that risk", said BNY Mellon FX strategist Neil Mellor.
The yen on Friday added to a strong weekly rally against the dollar of close to 1.5 per cent, hitting its highest versus the greenback in nearly four months, at 108.73 yen. The market was waiting f or USA consumer inflation data on Friday that would offer more clues about future Fed decisions.
"Of course, it's all come at a time when share markets are due for a correction, so North Korea has provided a flawless trigger".
Emerging market stocks lost 1.27 percent.
"Pretty remarkable, perhaps even extraordinary, considering", said Tim Ash, strategist at fund manager BlueBay.
Dollar/yen was last trading at 109.2, gold was at $1,285.75 an ounce, dollar/franc was at 0.9625.
The MSCI World index slipped 0.15 percent, extending Thursday's 1.1 percent drop, its biggest one-day slide since May 17.
If North Korea launches an attack that threatens the United States, China should stay neutral, but if the USA attacks first and tries to overthrow North Korea's government, China will stop them, a Chinese state-run newspaper said on Friday.
"This situation is beginning to develop into this generation's Cuban Missile crisis moment", ING's chief Asia economist Robert Carnell wrote in a note.
Spot gold (XAU=) added 0.7 percent to $1,286.00 an ounce.
Crude oil prices tumbled on the back of the selloff on Wall Street and lingering concerns over global oversupply.
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.
Global benchmark Brent also lost 0.9 percent to $51.44, after Thursday's 1.5 percent drop.