Mega-cap growth stocks led the drop, with Apple Inc and Amazon.com Inc falling 3.6% and 4.2%, respectively, and putting the most pressure on the S&P 500 and the Nasdaq.
Recent sharp gains in oil prices also weighed on sentiment before Friday’s US consumer price index report. The data is expected to show that consumer prices rose 0.7% in May, while the core consumer price index , which excludes the volatile food and energy sectors, rose 0.5% in the month. The central bank has raised its short-term interest rate by three-quarters of a percentage point this year and intends to keep at it with 50 basis points increases at its meeting next week and again in July.