By 06:05 ET (10:05 GMT), the Dow Jones Industrial Average fell 250 points, or 0.6%, the S&P 500 dropped 20 points, or 0.4%, lower and the NASDAQ Composite slipped 30 points, or 0.2%.

Fed starts June meeting

The Federal Reserve starts its latest two-day policy-setting meeting Tuesday, prompting a degree of caution in the stock markets.

The U.S. central bank is widely expected to leave interest rates on hold at a more than two-decade high of 5.25% to 5.5% on Wednesday, with several officials having recently suggested that they need further evidence the pace of inflation is cooling back down to their 2% target level before beginning to lower rates. 

Of more interest is likely to be the subsequent press conference from Fed Chair Jerome Powell as well as the revelation of the bank’s latest "dot plot", which outlines how officials expect borrowing costs to evolve in the future. 

The FOMC predicted three interest rate cuts this year when its forecasts were last released, but policymakers are likely to have lowered the number of cuts they now see.

US CPI release due

The economic data slate is quiet Tuesday, but Wednesday also sees the release of the May reading of its U.S. consumer price index, a highly-anticipated gauge of inflation in the world's largest economy.