ASX futures were down 57 points (or 1 per cent) by 7:20am AEST & the Australian dollar had dropped (-0.9pc) to 72.24 US cents.

Wall Street tumbled overnight, for the third straight week, on concerns about the inability of US politicians to agree on fiscal stimulus that would support millions of unemployed.

In the end, the Dow Jones index lost 510 points (or 1.8 per cent) to 27,148 points.

The S&P 500 fell (-1.2pc) to 3,281, and was down about 9 per cent from the record high it reached on September 2.

The tech-heavy Nasdaq slipped (-0.1pc) to 20,779.

Ginsburg's death may affect US economy

US Congress has for weeks remained deadlocked over the size and shape of another coronavirus-response bill, on top of the roughly $US3 trillion already enacted into law.

The death of US Supreme Court Justice Ruth Bader Ginsburg could make the passage of another stimulus package in Congress less likely before the November 3 presidential election.

"It just kind of crowds out the agenda, the idea that we are going to get a fiscal stimulus package before the election," said Ed Campbell, managing director at QMA New Jersey.

"There is also just general election-related jitters ... and possibly that we have a contested or delayed outcome."

European markets sell off

Markets in Europe were hit even harder on fears of renewed lockdown measures in Europe and Britain.

Britain's FTSE dropped 3.4 per cent to 5,804, while Germany's DAX plunged 4.4 per cent to 12,542 points.

The United Kingdom is considering a second national lockdown as new cases rise by at least 6,000 per day.

Meanwhile, Denmark, Greece and Spain have introduced new restrictions on activity.

Oil prices also tanked, with Brent crude (-3.2pc) down to $US41.76 per barrel.

Spot gold dropped (-2pc) to $US1,911.71 an ounce.