Wall Street stocks finished sharply lower on Monday after a fresh attack on Federal Reserve chair Jerome Powell by US President Donald Trump sparked another round of sell-off.

All three major equity indices finished down by around 2.5 percent while the US dollar retreated and Treasury bond yields moved higher.

There is a "narrative of weakening demand for US assets," said Briefing.com analyst Patrick O'Hare.

The Dow Jones dropped 2.5 percent to 38,170.

The S&P 500 fell 2.4 percent to 5,158, while the Nasdaq shed 2.6 percent to 15,870.

Equities fell shortly after the market opened when Trump called Powell a "major loser" for not cutting interest rates in a social media post, underscoring questions about whether Trump will attempt to fire Powell after threatening the action last week.

Trump's continued banter about removing or replacing Powell throws into question the independence of the US central bank in which the Fed is free from political interference as it sets monetary policy based on the imperatives of ensuring stable prices and achieving maximum employment

Investors view this tradition as foundational to American markets.

All 11 sectors of the S&P 500 finished in the red. Of the 30 members of the Dow index, only Nike mustered a modest gain, with the other companies finishing lower. (AFP)