US stocks sink nearly three percent as China worries mount

US stocks lost another nearly three percent overnight as new data offered more evidence that China's industrial machine is stalling.

At the closing bell the Dow Jones Industrial Average was down 2.84 percent, while the S&P 500 lost 2.96 percent and the Nasdaq Composite gave up 2.94 percent.

The US will press fellow G20 economies this week to act to boost world growth, and urge China to better communicate its policies, a senior Treasury official said Tuesday.

The official said Treasury Secretary Jacob Lew's focus will be on measures countries can undertake to stimulate demand when the economic chiefs of the Group of 20 elite economies meet on Thursday and Friday in Ankara, Turkey.

"He will emphasize that, fundamentally, the world needs more demand," said the official, who spoke on condition of anonymity.

"We need more strong, reliable engines of global demand," he said, pointing to fiscally stronger countries "with space" economically to help via deeper stimulus efforts.

"I don't think it's too late" to do this, the official said.

He also said that Lew will stress to his counterpart from Beijing that China must better communicate its economic policies to bring calm to markets.

"Concerns over economic momentum particularly in China have weighed on commodities and markets generally," the official said.

In addition to continuing key reforms, he said, critical to China's success "is carefully communicating its intention and actions to financial markets."

"It's important for communication to be clear and effective across a range of issues, be they related to growth, financial markets and so forth."