Equities slid overnight with the price of oil as investors awaited the result of the US Federal Reserve two-day meeting starting on Tuesday. (US time)
The Federal Open Market Committee is widely expected to announce its first interest rate increase since 2006 on Wednesday, and investors will eye a press conference by Chair Janet Yellen at the end of the meeting to gauge the Fed's view on further increases.
Oil slid further, with Brent crude down 4 percent and US West Texas Intermediate nearly 3 percent at midday in New York, amid persistent concern about worldwide oversupply at a time of weakening demand in the global economy. In overnight trade US oil briefly dipped below US$35 a barrel.
"It's the (Fed) communiqué that's going to count, but the real problem here is the junk bond market, which is tied to oil prices," Peter Cardillo, chief market economist at First Standard Financial in New York, told Reuters. "A lot of paper written to oil companies are in question, and so it ties in with the price of oil."
Wall Street moved lower. In 12.04pm trading in New York, the Dow Jones Industrial Average fell 0.2 percent. In 11.49am trading, the Standard & Poor's 500 Index dropped 0.8 percent, while the Nasdaq Composite Index shed 0.7 percent.