Dow dives over 200 points with US debt deal poised to fail

US shares plunged at opening ahead of an expected announcement politicians have failed to agree a deal to cut the US' sprawling budget deficit.

The Dow opened down 1.8% or 212 points, at 11,583, while the S&P 500 shed 1.4%, or 16.9 points to 1,198.8.

Markets around the globe had already sold off earlier amid reports the super committee put together to agree a deficit reduction plan had failed to reach an agreement.

Lawmakers had been trying to formulate a deal which cut $1.2trn from the deficit ahead of today's deadline as they move to tackle the US' monumental - and expanding - debt pile.

At last count, the US deficit was above $15trn. An announcement is expected imminently.

In Europe shares remained under the cosh, with the FTSE 100 off 1.7% or 93.7 points to 5,269, while the French Cac 40 fell 2.7% to 2,915 points.

The German Dax was off 2.4% at 5,660 points.