There's hope that Germany, Europe's largest economy, is still expanding, albeit at a slower rate. A report tomorrow will probably show that Germany's GDP slowed to 0.2 per cent in the second quarter from 0.5 per cent in the first, according to a Bloomberg survey.
In late afternoon trading in New York, the Dow Jones Industrial Average declined 0.45 per cent, the Standard & Poor's 500 Index fell 0.43 per cent and the Nasdaq Composite Index shed 0.34 per cent.
Kansas City Federal Reserve President Esther George, who will be a voter on the Federal Reserve's Federal Open Market Committee next year, expressed doubt that further US central bank action will create jobs for the unemployed.
"At this point we have a tremendously accommodative policy for the economy to begin the process of recovery," George said in introductory remarks at a conference. "Will monetary policy put people back to work at this point? That's not clear."
Meanwhile, Google said it will slash about 4,000 jobs and close a third of the facilities at its Motorola Mobility unit. Google shares rose more than 2 per cent.
In Europe, the Stoxx 600 Index ended the day with a 0.4 per cent drop from the previous session. The UK's FTSE 100 and France's CAC 40 both fell 0.3 per cent, while Germany's DAX slid 0.5 per cent.
There was a bright spot as Italy's debt auction met solid demand - and its target - as the nation sold 8 billion euros worth of one-year bills.
The Rome-based Treasury sold the bills at 2.767 per cent, up from 2.697 per cent at the last sale of similar-maturity debt on July 12,, according to Bloomberg. Investors bid 1.69 times the amount of bills offered, up from 1.55 times last month.