U.S. stock index futures fell steeply on Thursday, pointing to a lower open to the market, as fears about the reduction of the $85 billion a month bond-buying stimulus program and weak factory data from China brought down global markets.

Futures on the Dow Jones Industrial Average were down 0.92 percent while futures on the Standard & Poor's 500 Index and Nasdaq were down more than 1 percent.

Stocks in Japan's markets led a slump that resonated across Asian markets as concerns over the Fed's future policy were compounded by data that showed an unexpected fall in China's manufacturing sector. Japan’s Nikkei Stock Average lost 7.32 percent on Thursday -- one of its worst single-day falls – to end the session at 14483.98.

On Wednesday, U.S. stock markets had reacted sharply to a mixed message from the Federal Reserve and ended the day on the downside. The Dow Jones Industrial Average dropped 0.52 percent or 80.41 points to close at 15,307.17, the S&P 500 Index dropped 0.83 percent to close at 1,655.35 and the Nasdaq Composite Index shed 1.11 percent to end the session at 3,463.30.

Fed Chairman Ben Bernanke’s remarks favoring the continuation of its quantitative easing, or QE, policy for the present initially drove markets higher.

Bernanke told Congress that a decision to scale back the monetary stimulus program may come at one of Fed's "next few meetings" and any change would be made after considering the inflation and unemployment data for the coming month.

However, the release of FOMC minutes later in the day, which showed that a few members favored the tapering of the Fed’s asset purchasing program as early as June, jolted the markets.  

"There seems to be a bit more dissent at the Fed, or at least that's how people are reading the minutes," Joseph Saluzzi, co-head of equity trading with Themis Trading, was quoted as saying by CNNMoney.

Investors now await the release of a wave of economic data on Thursday including the publication of the Labor Department's weekly jobless claims data and new home sales data for the month of April.

The Department of Labor will report initial jobless claims data, which measure the number of individuals who filed for unemployment insurance for the first time last week, before the opening bell on Thursday. Initial jobless claims are forecast to be 345,000 for the week ended May 18, which is down from 360,000 recorded in the previous week, according to the median estimate of economists polled by Reuters.

Meanwhile, continuing jobless claims, which measures the number of unemployed individuals who qualify for benefits under unemployment insurance, is expected to drop to 3 million from 3.1 million in the previous week. 

Investors will also focus on new home sales data, which are expected to be released after market hours on Thursday. A Bloomberg survey of economists expects this number to be 425,000 for April, up from 417,000 recorded in the previous month.

In addition, preliminary reading of the Markit U.S. Manufacturing Purchasing Managers’ Index (PMI) due to be released at 8.58 a.m. EDT is expected to show a reading of 51.80 in May, down from the 52.10 recorded in April.  

Disappointing data from China reporting a contraction in the country’s factory activity also hurt sentiment across world markets on Thursday, raising concerns over the strength of the world’s second-largest economy. The preliminary HSBC China Manufacturing Purchasing Managers' Index (PMI) for May fell to 49.6 in comparison to a final reading of 50.4 in April and falling below the 50.0 figure, which indicates contraction, for the first time since October.

European stock markets were trading down on Thursday with Germany's DAX-30 down 2.70 percent, France's CAC-40 declined 2.47 percent and London's FTSE 100 lost 1.88 percent.

In Asia, most stock markets traded sharply lower with Japan stocks leading the slump. Hong Kong’s Hang Seng lost 2.54 percent, Chinese Shanghai Composite shed 1.16 percent and South Korea’s KOSPI Composite dropped 1.24 percent.