By Medha Singh
All the 11 major S&P 500 sectors were in the red, with the benchmark index seeing the worst December since the Great Depression.
The and healthcare sectors ceded further ground, dropping 0.90 percent and 1.27 percent, respectively.
With the equity markets in free fall, Mnuchin spoke with the heads of the six largest U.S. banks, who confirmed they have enough liquidity to continue lending and that "the markets continue to function properly."
His plan to convene a call with the President's Working Group on financial markets, commonly as the "Plunge Protection Team", weighed on investor sentiment.
"It seems unexpected, abrupt and unnecessary," said Michael Purves, chief global strategist at Weeden & Co in Greenwich, Connecticut.
"We are not in a crisis. Compared to 2008, the economic data is like at the other end of the spectrum. We have banking stability, we have volatile but functioning markets. We had an ugly December but it's not a function of any systemic thing along those lines."
The Cboe Volatility Index, the most widely followed barometer of expected near-term fluctuations for the S&P 500, touched its highest since Feb. 9.
"What's affecting the investors' minds the most is what the next news item will be. It moves from one concern to the next, but that anxiety is what's really driving the markets," said Tom Plumb, president of Plumb Funds in Madison, Wisconsin.
At 11:22 a.m. ET, the Dow Jones Industrial Average was down 352.58 points, or 1.57 percent, at 22,092.79. The S&P 500 was down 32.51 points, or 1.35 percent, at 2,384.11 and the Nasdaq Composite was down 31.62 points, or 0.50 percent, at 6,301.37.
A bruising December for the U.S. markets - triggered by concerns over a partial federal government shutdown, the U.S.-China trade dispute and interest rate hikes - has put the S&P 500 on pace for its biggest monthly percentage decline since 2008.
At the end of Friday's session, the Nasdaq was down nearly 22 percent from its record high close in late August and formally in a bear market. The S&P and Dow are also not far off those levels, having sunk 17.5 percent and 16.3 percent, respectively, as of Friday from their closing highs.
The decline picked up pace last week after the Federal Reserve said it would largely continue with its rate hike path and would slim down its vast holdings of bonds, draining the easy money that has helped power the market's decade-long bull run.
President Donald Trump again blasted the Fed on Monday, describing it as the "only problem" for the U.S. economy.
The latest criticism comes in the backdrop of reports that suggested Trump had privately discussed firing Fed Chairman Jerome Powell. Mnuchin said on Monday Trump does not believe he has the power to remove Powell.
Declining issues outnumbered advancers for a 2.19-to-1 ratio on the NYSE and for a 1.26-to-1 ratio on the Nasdaq.
The S&P index recorded no new 52-week highs and 232 new lows, while the Nasdaq recorded three new highs and 721 new lows.
(Reporting by Medha Singh in Bengaluru; Additional reporting by Saqib Ahmed in New York; Editing by Saumyadeb Chakrabarty and Sriraj Kalluvila)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)