Asian stocks started Tuesday under a cloud with markets waiting nervously to see how Chinese shares fare later in the session after Monday's slump all but erased risk appetite.The dollar was under pressure as China jitters spurred flows into havens such as the yen, while commodities including oil and copper wilted amid fears of a collapse in demand from China.
MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.3%.
Tokyo's Nikkei sank 1%, with a stronger yen accelerating the decline.
Australian shares were down 0.9% and South Korea's Kospi lost 0.5%.
Overnight, the Dow dropped 0.7% and Nasdaq fell 1% while share indices in Frankfurt and Paris tumbled more than 2.5%.
The world-wide slide in equities followed Monday's capitulation in Chinese stocks, in which the Shanghai Composite Index tanked 8.5% to mark the steepest fall in eight years.
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The freefall in Chinese equities came in the wake of drastic government attempts to arrest a sharp retreat in shares which began in mid-June.
The government measures appeared to work for a while, but Monday's rout, which put an end to three weeks of relative calm, showed the myriad support mechanisms that had helped stabilise values were already losing traction.
"Clearly the Chinese markets are unable to support themselves. The mountain of leverage and the risks of margin calls are hitting market stability," Evan Lucas, market strategist at IG in Melbourne, wrote.
Following Monday's massive sell-off, Chinese authorities said they were ready to buy shares to stabilise the stock market and avert "systemic risks." The securities regulator also said market authorities would deal severely with anyone engaged in the "malicious shorting of stocks".
In currencies, the dollar was steady at 123.29 yen after shedding 0.5% overnight when upbeat US durable good orders data proved no tonic for the greenback.
The euro was little changed at $1.1087 after surging to a two-week high of $1.1129 overnight thanks to a bullish Ifo survey of German business sentiment.
Focus was on whether the dollar can slow its retreat before the July 27-28 Federal Reserve policy meeting, at which the US central bank may give a supportive hint as to when it may begin raising interest rates.
Oil struggled at four-month lows after the Chinese stock market crash fuelled worries the world's biggest energy consumer may cut back and as more evidence emerged of a global crude supply glut.
US crude
Copper
The broader Thomson Reuters CRB commodities index also hit a six-year low.