Adding to the concerns of the global economy, US stocks fell sharply by 0.92%. Despite making gains on news of several merger and acquisition deals (M&A activity), US shares did not show any improvements further. Server merger and acquisition deals indicate corporate use of high cash balances to get ready for the expansion mode. Typically, the cost-cutting methods are used to grow profits.

The technology stocks faced a tug-of-war like situation when the two tech giants Hewlett-Packard and Dell bid for the 3PAR Inc, a data storage company. This bidding war led to a fearsome situation for the investors and pushed the stocks further down. HP slipped by 2% while Dell stocks fell by 1.1% boosting up 3PAR stocks by 44.6%.

After achieving nearly 1% hike in the early trade, the three main U.S. stock indexes erased the earlier gains and fell between 0.38 to 0.92%. The Dow Jones industrial average was (-0.38), S&P (-0.40%) and The Nasdaq Composite Index (-0.92%).

However, the dollar rose against key currencies like Euro, which was hit by weak European economic data and predictions of the loose monetary policy hanging for a longer period of time.

U.S. crude oil prices CLc1 dipped by 0.98% to $73.10 a barrel, the lowest close since July 6, as a stronger dollar made it more expensive for investors using other currencies to buy the commodity.