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NEW YORK (CNNMoney.com) -- U.S. stocks were poised for a rough start Monday as investors watched most major overseas markets tumble and awaited the upcoming Federal Reserve policy meeting along with President Bush's final State of the Union address.

At 6:16 a.m. ET, Nasdaq and S&P futures were sharply lower, indicating a negative start for Wall Street.

Hanging over investors was another big drop in world markets. Stocks tumbled across Asia, with Japan's Nikkei closing down nearly 4 percent and the Shanghai Composite plunging more than 7 percent. Markets in Singapore, Seoul and Taiwan also all lost more than 3 percent.

European markets also fell in morning trading, with major indexes there down between 1 and 2 percent in the early going.

Oil prices tumbled below the $90 a barrel mark on global recession fears, as a barrel of light sweet crude lost $1.49 to $89.22 a barrel in electronic trading.

Investors worldwide have their focus on the Federal Reserve, which kicks off a two-day policy meeting Tuesday. Markets are expecting the U.S. central bank to lower rates again after making an emergency cut last week.

Investors also await President Bush's State of the Union address for more comments on the U.S. economy and administration proposals for dealing with the slowdown beyond the deal reached last week. A bipartisan deal on a $150 billion stimulus package was announced Thursday.

A batch of reports that may offer more clues about whether the U.S. economy is headed for a recession are on tap this week. The key report is the government's closely watched reading on the labor sector, which is due on Friday.

The first economic report due this week is Monday's report on new home sales in December. Economists surveyed by Briefing.com are forecasting the pace of sales in the month fell to a 12-year low, capping a year which is likely to see the biggest percentage drop in full-year sales since the Census Bureau started tracking these sales in 1963. The median price for a new home sold in 2007 is also expected to post the first decline in 16 years.

On the earnings front, Dow components McDonalds (MCD, Fortune 500) and Verizon (VZ, Fortune 500) are set to report results before the market open Monday. Another Dow component, American Express (AXP, Fortune 500), is due to report after the market close. Investors will be watching that report for more details on late credit card payments by U.S. consumers.

Countrywide Financial (CFC, Fortune 500) CEO Angelo Mozilo, facing criticism over the size of his potential payout from the proposed sale of his troubled mortgage company to Bank of America (BAC, Fortune 500), announced early Monday he will not get some $37.5 million in severance pay, fees and perks he was scheduled to receive upon his retirement, although he will still receive retirement benefits and deferred compensation.

Troubled retailer Sears Holdings (SHLD, Fortune 500) announced CEO Aylwin Lewis will leave the company as of Feb. 2. W. Bruce Johnson, the company's executive vice president, supply chain and operations, has been appointed as interim chief executive. Sears Holdings, which includes both the Sears and Kmart brands, has seen shares plunge 40 percent in the last 12 months, badly trailing rivals such as Wal-Mart Stores (WMT, Fortune 500).