response if threatened@ (Adds South Korean missile drill, discussion of more possible sanctions, U.S. stock futures down)
* North Korea says hydrogen bomb designed for new ICBM
* Magnitude 6.3 represents North's most powerful detonation
* Trump rebukes Seoul, says it's trying to appease Pyongyang
* U.N. Security Council to meet Monday to discuss test
* China condemns Pyongyang's sixth nuclear test
SEOUL/WASHINGTON, Sept 3 (Reuters) - North Korea on Sunday conducted its sixth and most powerful nuclear test, which it said was of an advanced hydrogen bomb for a long-range missile, prompting the threat of a "massive" military response from the United States if it or its allies were threatened.
Speaking outside the White House after meeting with President Donald Trump and his national security team, U.S. Defense Secretary Jim Mattis said Trump asked to be briefed on all available military options.
"Any threat to the United States or its territories, including Guam or our allies will be met with a massive military response, a response both effective and overwhelming," Mattis said.
"We are not looking to the total annihilation of a country, namely North Korea," Mattis said with Joseph Dunford, the chairman of the Joint Chiefs of Staff, at his side. "But as I said, we have many options to do so."
Trump earlier in the day refused to rule out military action and threatened to cut off trade with any country doing business with Pyongyang.
Asked while leaving a church service whether the United States would attack North Korea, Trump replied: "We'll see."
Early Monday in Seoul, South Korea's military confirmed it had carried out missile drills in response to the North's nuclear test.
Despite the tough talk, the immediate focus of the international response was expected to be on tougher economic sanctions against Pyongyang.
The United Nations Security Council is scheduled to meet on Monday to discuss the nuclear test.
Diplomats have said the council could now consider banning Pyongyang's textile exports and the country's national airline, stop supplies of oil to the government and military, prevent North Koreans from working abroad and add top officials to a blacklist to subject them to an asset freeze and travel ban.
U.S. Treasury Secretary Steve Mnuchin said on Sunday that he would put together a package of new sanctions to potentially cut off all trade with North Korea.
"If countries want to do business with the United States, they obviously will be working with our allies and others to cut off North Korea economically," Mnuchin told Fox News.
North Korea, which carries out its nuclear and missile programs in defiance of U.N. Security Council resolutions and sanctions, said on state television that the hydrogen bomb test ordered by leader Kim Jong Un had been a "perfect success."
The bomb was designed to be mounted on its newly developed intercontinental ballistic missile, or ICBM, the North said.
The test had registered with international seismic agencies as a man-made earthquake near a test site. Japanese and South Korean officials said the tremor was about 10 times more powerful than the one picked up after North Korea's last nuclear test a year ago.
U.S. stock futures fell 0.5 percent after trading reopened on Sunday evening.
After weeks of profound tensions over North Korea's nuclear program, the size and scope of the latest test set off a new round of diplomatic handwringing.
Chinese President Xi Jinping and Russian President Vladimir Putin, who met on the sidelines of a BRICS summit in China, agreed to "appropriately deal" with North Korea's nuclear test, the Xinhua news agency reported.
As North Korea's sole major ally, China said it strongly condemned the nuclear test and urged Pyongyang to stop its "wrong" actions.
In a series of early morning tweets, Trump appeared to rebuke ally South Korea, which faces an existential threat from North Korea's nuclear program.
"South Korea is finding, as I have told them, that their talk of appeasement with North Korea will not work, they only understand one thing!" Trump said in an early morning tweet.
Trump appeared to be blaming South Korea for a policy it abandoned years ago of trying to soften North Korea's posture through economic aid.
South Korea's new president, Moon Jae-in, has argued for continuing dialogue with its neighbor over its nuclear program, while also supporting international sanctions.
Reports that the United States is considering pulling out of its trade deal with South Korea have also ratcheted up tensions with the country.
A former senior State Department official criticized Trump for accusing South Korea of appeasement.
It was unseemly, unhelpful, and divisive to gratuitously slap our major ally at the very moment when the threat from (North Korea) has reached a new height, said the official, who spoke on condition of anonymity.
The U.S. president has previously vowed to stop North Korea developing nuclear weapons and said he would unleash "fire and fury" on the country if it threatened U.S. territory.
Roy Blunt, a Republican senator and a member of the U.S. Senate Foreign Relations Committee, backed Trump's fiery rhetoric on Sunday.
"I think the president putting everything on the table is, is not a bad thing right now, both for North Korea, but maybe more importantly for China to be thinking about how consequential this behavior is," Blunt said on NBC's "Meet the Press."
Trump's trade threat may be a way to pressure China, Pyongyang's top trading partner, into doing more to contain its neighbor.
But Matthew Goodman, a trade expert at Washington's Center for International and Strategic Studies, said Trump's suggestion was not viable because it would mean the United States would cut off trade with countries such as France, India, and Mexico, along with China.
The notion of stopping 'all trade' with anyone who does business with North Korea is absurd," Goodman said.
There was no independent confirmation that the detonation was a hydrogen bomb rather than a less powerful atomic device, but Japanese Chief Cabinet Secretary Yoshihide Suga said Tokyo could not rule out such a possibility.
Experts who studied the impact of the earthquake, which the U.S. Geological Survey measured at magnitude 6.3, said there was enough strong evidence to suggest the reclusive state had either developed a hydrogen bomb or was getting very close.
The head of the U.N. nuclear watchdog, IAEA Director General Yukiya Amano, said the nuclear test was "an extremely regrettable act" that was "in complete disregard of the repeated demands of the international community."
Moon said Seoul would push for strong steps to further isolate the North, including new U.N. sanctions. Japan also raised the prospect of further sanctions, saying curbs on North Korea's oil trade would be on the table.
The United States has repeatedly urged China to do more to rein in its neighbour, but Beijing has lambasted the West and its allies in recent weeks for suggesting that it is solely responsible for doing so. It has said military drills by South Korea and the United States on the Korean peninsula had done nothing to lessen tensions.
Under third-generation leader Kim, North Korea has been pursuing a nuclear device small and light enough to fit on a long-range ballistic missile, without affecting its range and making it capable of surviving re-entry.
The test comes amid heightened regional tension following Pyongyang's two tests of ICBMs in July that potentially could fly about 10,000 km (6,200 miles), putting many parts of the U.S. mainland within range.
During the nuclear test, people in the Chinese city of Yanji on the North Korean border said they felt a tremor that lasted roughly 10 seconds, followed by an aftershock.
Hours before the test, North Korean state news agency, KCNA, released pictures showing Kim inspecting a silver-coloured, hourglass-shaped warhead during a visit to the country's nuclear weapons institute.
KCNA said North Korea "recently succeeded" in making a more advanced hydrogen bomb.
"All components of the H-bomb were homemade and all the processes ... were put on the Juche basis, thus enabling the country to produce powerful nuclear weapons, as many as it wants," KCNA quoted Kim as saying.
Juche is North Korea's homegrown ideology of self-reliance. It says its weapons programs are needed to counter U.S. aggression.
(Additional reporting by Elaine Lies, Kiyoshi Takenaka, Tim Kelly, Takaya Yamaguchi and Nobuhiro Kubo in Tokyo, Jane Chung, Yuna Park, Ju-min Park and James Pearson in Seoul, Sue-Lin Wong in Yanji, David Brunnstrom and Jonathan Landay in Washington, and Shadia Nasralla in Vienna; Writing by Alex Richardson, Raju Gopalakrishnan, James Oliphant and Warren Strobel; Editing by Mary Milliken and Peter Cooney)