Wall St slides on Fed worries

Concerns of faster-than-eConcerns of faster-than-expected taper force US, European markets down.xpected taper force US, European markets down.

US stocks have followed European markets lower in afternoon trade amid concerns the US Federal Reserve will scale back its bond-buying program more quickly than previously thought.

At 0530 AEDT, the Dow Jones Industrial Average had lost 133.58 (0.83%) to trade at 15,875.19.

The broad-based S&P 500 dipped 11.22 (0.62%) to 1,789.68, while the tech-rich Nasdaq Composite Index gave up 20.66 (0.51%) to 4,024.50.

The pullback extended Monday's declines on Wall Street and followed fairly steep drops on Tuesday in Europe.

France's CAC 40 closed down 2.7% and the German DAX lost 1.9%, while Britain's FTSE 100 fared a little better, ending down 0.95%.

Analysts attributed the declines to speculation the Fed could scale back its asset-purchase program later this month following better data this week on manufacturing activity.

On the back of eight weeks of gains, it is also likely investors are looking for an excuse to take some profits off the table.

Friday's US jobs report for November is expected to provide a key sign about whether the economy is strong enough for the stimulus to be tapered.