Wall Street dropped ahead of a speech by US Federal Reserve Chair Janet Yellen, while shares of Caterpillar sank after the company downgraded its full-year earnings forecast and announced plans to cut jobs.
Yellen is set to speak after the market close, a week after the central bank kept its target interest rate steady amid concern about the global economy.
Currently traders are pricing in about a 40 percent chance of an increase in December, down from 49 percent as recently as Monday, and a 48 percent probability in January, according to Bloomberg.
In New York trading at about 3.10pm, the Dow Jones industrial average dropped 0.6 percent, the Standard & Poor's 500 Index slipped 0.1 percent, while the Nasdaq Composite Index fell 0.2 percent.
"You need to see better China data and more certainty about the Fed," Scott Wren, senior global equity strategist at Wells Fargo Investment Institute in St. Louis, Missouri, told Reuters.