US pre-open: All eyes on the Fed

The Dow Jones Industrial Average was set to open down 83 points, while the S&P 500 and the Nasdaq were expected to start the session off by 10 and 34 points lower respectively.

Data about new home sales for December will be out at 1500 GMT, while oil inventories data will be released at 1530 GMT by the Department of Energy, before the big announcement from the US Federal Reserve at 1900 GMT.

China claws back early losses

Elsewhere, China once again dominated the day in Asia, with its main index closing down slightly after having recovered from some serious losses early in the session.

Wednesday was the second day of losses for Shanghai, which lost a sizeable 6.4% on Tuesday as investors were worried that capital outflows from the mainland were increasing during the country's slowdown.

Experts and traders in the country were pointing to evidence that the politburo was moving away from its focus on artificially holding up the markets, something it had done in various ways since the summer crash.

Rather, Beijing was looking at keeping the renminbi stable and nurturing the economy back towards stable growth.

"In the short term, (Beijing) will most likely continue to inject liquidity in the system via open market operations instead of (reserve requirement ratio) cuts to avoid pressuring further capital outflow", said East Capital Asia portfolio manager Francois Perrin in a note.

European stocks fell as investors erred on the side of caution ahead of the Federal Reserve announcement, with energy issues under pressure as oil prices slipped.

Brent was down 1.86% to $31.21 a barrel while West Texas Intermediate dropped 3.28% to $30.42. Overnight, the American Petroleum Institute revealed an 11.4m barrel build in US stockpiles last week.

The dollar was up 0.26% against the pound, but had dropped 0.02% against the euro and 0.04% against the yen. Spot gold was down 0.18% to $1,117.88.

In company news, Apple shares are expected to open down nearly 4% after the technology giant said late on Tuesday that iPhone sales grew at the slowest pace since its first model and that revenue will fall at its steepest rate in 15 years.

Boeing shares also plunged over 5% after the aircraft manufacturer issued a full-year guidance of $8.45 to $8.65 per share that was below expectations.