The euro skidded on Wednesday and Asian shares fell after European officials failed to reach a deal on another bailout for Greece, a day after Federal Reserve Chairman Ben Bernanke highlighted the dangers of a U.S. fiscal crisis.
U.S. stock futures eased 0.4%, pointing to a weak Wall Street open.
Financial spreadbetters predict London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX would open down as much as 0.2%, following weakness in Asia.
The euro slumped 0.5% to $1.2752, extending losses and retreating from Tuesday's two-week high of $1.28295.
The euro's decline lifted the dollar up 0.3% against a basket of key currencies and weighed on commodities such as gold, which eased 0.3% to $1,722.70 an ounce.
"The euro is being sold because markets had believed the ministers would agree on aid for Greece at today's meeting," said Yuji Saito, director of foreign exchange at Credit Agricole in Tokyo.
"Instead, a settlement is postoned, highlighting the difficulty of getting consensus on the debt crisis. But I feel this is a typical European political show and an agreement will be reached."
The bearish news from Europe dragged down Asian shares, whose two-day rise had already been stalled after Bernanke on Tuesday repeated a warning that failure to avoid the $600 billion "fiscal cliff" in expiring tax cuts and government spending reductions could lead to recession in the United States.
The Fed chief said worries over how budget negotiations will be resolved were already damaging growth.
Concerns about the United States failing to raise its debt ceiling rattled financial markets in August 2011 and prompted Standard & Poor's to cut the top-notch U.S. government bond rating for the first time ever.
"The price action suggests market participants are unclear of what to make of recent developments and therefore this warrants some caution," said Stan Shamu, strategist at IG Markets.
But Hirokazu Yuihama, a senior strategist at Daiwa Securities, said that for all the concerns over the fiscal cliff, most of the market expected the U.S. Congress and White House to reach a compromise to avert the crisis.
MSCI's broadest index of Asia-Pacific shares outside Japan slipped 0.2%. Hong Kong shares bucked the falling trend but pared earlier gains to rise 0.5% while Shanghai shares inched up 0.3%.
Japan's Nikkei stock average closed up 0.9% at a two month-high as exporters were buoyed by a weaker yen.
The yen has come under pressure on expectations that a general election on Dec. 16 will result in victory for an opposition leader who wants the Bank of Japan to aggressively ease monetary policy to stem the economy from further deterioration.
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Investors will now focus on HSBC China flash PMI for November due on Thursday to see whether a low point for China, the world's second largest economy, is over. U.S. manufacturing figures are due later on Wednesday while those from Europe are due on Thursday.
Trading activity was slowing ahead of the U.S. Thanksgiving long weekend.
Going into the holiday, the dollar has been underpinned broadly by data indicating a moderate U.S. recovery taking root, while the yen remained under pressure, with more data showing Japan's economy struggling.
Japan's exports fell 6.5% in October from a year ago, dropping for a fifth consecutive month, weighed down by weakening global demand and a territorial row with China, its main customer.
In the U.S. on Tuesday, a report showed housing starts rose to the highest rate in more than four years in October.
The dollar rose to a 7-1/2-month high against the yen of 81.975 yen while the euro briefly touched a peak of 105.05 yen, its highest point since May 4.
U.S. crude futures pared earlier gains and were up 0.1% to $86.85 a barrel by midafternoon, and Brent crude also trimmed earlier rises and wasup 0.2% at $110.03.
