Equities on both sides of the Atlantic slid overnight as investors eyed developments in Ukraine and Iraq and their impact on the global economy.
The price of oil dropped after the International Energy Agency cut its 2014 global oil demand growth forecast to 1.0 million barrels per day on lower than expected deliveries in the second quarter and the International Monetary Fund's weaker outlook for economic growth.
"Despite armed conflict in Libya, Iraq and Ukraine, the oil market today looks better supplied than expected, with an oil glut even reported in the Atlantic Basin," the IEA said in its Oil Market Report for August, Bloomberg News reported.
In late afternoon trading in New York, the Dow Jones Industrial Average shed 0.15 per cent, the Standard & Poor's 500 Index fell 0.39 per cent, while the Nasdaq Composite Index dropped 0.64 per cent.
Declines in shares of Chevron and Cisco Systems, down 0.9 per cent and 0.8 per cent respectively, led the Dow lower.