US Stocks Plummet Amid North Korea Fears and Rate Hike Worries

The US stock market plummeted on Friday, resulting in the S&P 500's worst day since June. The decline was fueled by concerns over North Korea's nuclear test and the likelihood of a rate hike by the Federal Reserve.

The CBOE Volatility index .VIX reached its highest level since late June, while the S&P 500 index closed below its 50-day moving average for the first time in about two months. This suggests that further weakness may be ahead, according to Reuters.

The equity selloff also came as the U.S. Treasury yield curve continued to steepen, with long-dated yields reaching more than two-month highs. Traditionally, September tends to be a month of lower returns for stocks, and traders said this year could be no exception given the abundance of uncertainties.

Giri Cherukuri, head trader at OakBrook Investments LLC in Lisle, Illinois, stated that 'with worries about growth and what the Fed is going to do about rate hikes... It could be the start of a little bit of a pullback.'