World stocks fell close to 1 percent on Wednesday after an overnight sell off on Wall Street, with both Asia and Europe rattled by concerns over the sustainability of this year's equity rally.

The dollar was little changed by the moves.

Anxiety about the health of financials and worries the 2009 global stock market rally may have run its course hit U.S. stocks hard on Tuesday and then carried over.

Japan's Nikkei <.N225> closed down 2.4 percent for the day and Europe's FTSEurofirst 300 <.FTEU3> was down 1 percent.

It all took around 0.9 percent off MSCI'S all-country world stock index <.MIWD00000PUS> and the more-volatile emerging market component <.MSCIEF> lost 1.4 percent.

Concerns have risen over the summer that stocks have risen so strongly since March that they are due a correction.

The rebound from March has been remarkable. Year-to-date gains for most of the indexes are strong, although we are still below pre-Lehman Brothers levels, said Valerie Plagnol, chief strategist at CM-CIC Securities, in Paris.

But the glass is still half empty. Macro data has improved, but we're in a pattern of destocking-restocking, and the outlook for consumer spending is still grim.

As a result, the focus is shifting toward Wall Street, where the broad S&P 500 index <.SPX> has fallen 3.2 percent with three consecutive losing sessions.

It fell 2.2 percent on Tuesday.

The question now is whether Wall Street will consolidate at this level or fall further, said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management.

FOREX STEADY

The euro was little changed, hovering near a two-week low against the dollar, although the slide in European shares kept traders wary and risk aversion boosted the yen against most major currencies.

We are constructive on data, we are constructive on risk as well but price action short-term tells us that the market is already positioned for a recovery, said Carl Hammer, currency strategist at SEB in Stockholm.

Maybe we need some more consolidation in the coming days before moving higher in terms of risk appetite.

The euro was flat at $1.4215 and the dollar lost 0.4 percent against yen to 92.46 yen

Euro zone bond yields were also relatively steady. Two-year paper was yielding 1.163 percent and Bunds were yielding 3.208 percent.

(Additional reporting by Blaise Robinson, Elaine Lies and Naomi Tajitsu; editing by Chris Pizzey)

Japan Nikkei 225