The Treasury Department issued a statement Sunday indicating that Mnuchin had met with the CEOs of some of the nation's largest banks, all of whom assured him that the markets were working properly and that they had sufficient liquidity to continue lending to consumers and businesses. Benchmark U.S. crude was down 2.1 percent to $44.61 a barrel in NY.
As technology stocks in the likes of Amazon and Cisco recorded a daily drop of 3 to 6 percent on the day, the Nasdaq Composite struggled to sustain any sort of momentum and dropped by 3 percent within a six-hour span.
The S&P 500 index slid 65.52 points Monday, or 2.7 per cent, to 2,351.10. December is usually a healthy month for stocks, but this month has been the worst since 1931.
A gauge of stocks worldwide posted an eighth straight decline on Monday as investors ignored Trump administration attempts to reinforce confidence and the USA president called the Federal Reserve the "only problem our economy has".
On Sunday, Mnuchin made a round of calls to the heads of the six largest USA banks, but the move only raised new concerns about the economy.
Last week, US stocks suffered one of the worst weekly falls in a decade as an interest rate rise and US-China trade tensions rattled markets. Trump has criticized Powell and the Fed for increasing interest rates, subjecting Powell to the kind of scathing public critique that is common for senior Trump appointees but which threatens the political independence of the worlds most powerful central bank.
"The sell-off is triggered nearly entirely by developments in the US markets, rather than by negative factors unique to the domestic market", Takashi Hiroki, chief strategist at Monex Securities in Tokyo, was quoted as saying by CNBC.
The president lashed out at the Fed on Monday after administration officials spent the weekend trying to assure financial markets that Powell's job was safe.
Trump's frustration with Mnuchin is rising after his attempts to calm Wall Street failed, CNN reported, citing a source close to the White House, who said that the treasury secretary could be in "serious jeopardy" with the president. "If the worst case scenario is about to happen, let's make sure we aren't the reason for it", said Dollarhide.
"They're raising interest rates too fast", the president said following a teleconference with USA troops. The offshore yuan was little changed after China released new rules promising to treat all companies equally, the latest positive step on the trade and investment front since US and Chinese tariff hikes were set on pause. Brent crude, used to price worldwide oils, declined 1.2 percent to $53.16 a barrel in London.
The decline in oil prices weighed on energy stocks.
In foreign exchange markets, the yen rose 0.1 percent to 111.10 per dollar, the euro was up 0.2 percent at $1.1390 and the pound was at $1.2662, a 0.1 percent rise. The euro advanced to $1.1417 from $1.1405.
Major indexes in Asia finished mixed.
The gap between two and 10-year yields has shrunk to fewer than 0.15 percentage point, a flattening of the curve that has sometimes heralded coming recessions in the past.