Wall Street was heading for another rout yesterday following a gloomy forecast from Apple and weak US manufacturing data.

The Dow Jones Industrial Average was down 2.4 per cent, more than 550 points, at 22,782.83.

The broad-based S&P 500 slumped 2.1 per cent to 2,457.14, while the tech-rich Nasdaq Composite Index tumbled 2.6 per cent to 6,493.07.

The  losses were a resumption of the trend that held for much of December, the worst month for equities in nearly a decade, amid worries over trade wars, Federal Reserve interest rate hikes and a US government shutdown.

Shares of Apple slid nine per cent after it announced late Wednesday that it was trimming its sales forecast for the most recent quarter, citing steeper-than-expected "economic deceleration" in China amid the US-China trade war.

Apple weighed on stocks when the market opened but equities fell further after the Institute for Supply Management a half hour later released data that showed weaker-than-expected manufacturing activity, with new orders plummeting in December.

Drug company Celgene surged 26.3 per cent after it reached a deal to be bought by the larger pharma company Bristol-Myers Squibb for $74 billion. Bristol-Myers fell 13.6 per cent.