A US aircraft carrier group set off for Korean waters on Wednesday, a day after North Korea shelled a South Korean island, in a move likely to enrage Pyongyang and unsettle its ally, China.
The nuclear-powered USS George Washington, which carries 75 warplanes and has a crew of over 6,000, left a naval base south of Tokyo and would join exercises with South Korea from Sunday to the following Wednesday, US officials in Seoul said.
"This exercise is defensive in nature," US Forces Korea said in a statement. "While planned well before yesterday's unprovoked artillery attack, it demonstrates the strength of the ROK (South Korea)-US alliance and our commitment to regional stability through deterrence."
North Korea said Seoul was driving the pensinula to the "brink of war" with "reckless military provocation" and by postponing humanitarian aid, the North's official KCNA news agency said. The dispatch did not refer to the planned military drills.
The United States and Japan urged China to do more to rein in North Korea after the reclusive nation fired scores of artillery shells on Tuesday at a South Korean island near the maritime boundary between the two sides.
The Seoul government said two South Korean civilians and two soldiers were killed and houses set ablaze in the attack, the heaviest in the region since the Korean War ended in 1953.
Beijing will not be pleased by the deployment of the aircraft carrier and will not respond to such pressure, said Xu Guangyu, a retired major-general in the People's Liberation Army who now works for a government-run arms control organisation.
"China will not welcome the US aircraft carrier joining the exercises, because that kind of move can escalate tensions and not relieve them," he said.
"Our biggest objective is stability on the Korean peninsula. That interest is not served by abandoning North Korea, and so there's no need to rethink the basics of the relationship."
Beijing has previously said an earlier plan to send the USS George Washington to US-South Korea joint exercises threatened long-term damage to Sino-US relations.
Tuesday's bombardment nagged at global markets, already unsettled by worries over Ireland's debt problem and looking to invest in less risky assets. But South Korea's markets, after sharp falls, recovered lost ground.
"If you look back at the last five years when we've had scares, they were all seen as buying opportunities. The rule among hedge funds and long-only funds is that you let the market sell off and watch for your entry point to get involved," said Todd Martin, Asia equity strategist with Societe Generale in Hong Kong.
Pyongyang said the firing was in reaction to military drills conducted by South Korea in the area at the time but Seoul said it had not been firing at the North.
Seoul, a city of over 10 million, was bustling as normal on Wednesday, a sunny autumn day, although developments were being closely watched by office workers on TV and in newspapers.
Editorials stepped up pressure on President Lee Myung-bak to respond more toughly than he has to past provocations by the North and two small groups held anti-North Korea protests.
US President Barack Obama, woken up in the early hours to be told of the artillery strike, said he was outraged and pressed the North to stop its provocative actions.
Although US officials said the joint exercise was scheduled before the attack by North Korea, it was reminiscent of a crisis in 1996 when then President Bill Clinton sent an aircraft carrier group through the Taiwan Strait after Beijing test-fired missiles into the channel between the mainland and Taiwan.
"We're in a semi state of war," South Korean coastguard Kim Dong-jin told Reuters in the port city of Incheon where many residents of Yeonpyeong island fled in panic as the bombardment triggered a fire storm.
"My house was burnt to the ground," said Cho Soon-ae, 47, who was among 170 or so evacuated from Yeonpyeong on Wednesday.
"We've lost everything," she said weeping, holding on to her sixth-grade daughter, as she landed at Incheon.
Calm things down:
Despite the rhetoric, regional powers made clear they were looking for a diplomatic way to calm things down. South Korea, its armed forces technically superior though about half the size of the North's one-million-plus army, warned of "massive retaliation" if its neighbour attacked again.
But it was careful to avoid any immediate threat of retaliation which might spark an escalation of fighting across the Cold War's last frontier.
Japanese Prime Minister Naoto Kan called on China to help rein in the hermit state.
China has long propped up the Pyongyang leadership, worried that a collapse of the North could bring instability to its own borders and also wary of a unified Korea that would be dominated by the United States, the key ally of the South.
Beijing said it had agreed with the United States to try to restart talks among regional powers over North Korea's nuclear weapons programme.
A number of analysts suspect Tuesday's attack may have been an attempt by North Korean leader Kim jong-il to raise his bargaining position ahead of disarmament talks which he has used in the past to win concessions and aid from the outside world.
"It's Mr Kim's old game to get some attention and some economic goodies," said Lin Chong-pin, strategic studies professor at Tamkang University in Taipei.
Analysts believe the attacks may also have been driven by domestic politics, with the ailing Kim desperate to give a lift to his youngest son, named as heir apparent in September but who has little clear support in the military.