The Dow dipped a quarter of a percent, while the S&P 500 and Nasdaq each shed more than half a percent.

Retail sales increased more than expected last month - thanks in part to steep discounts - which helped keep the economy on solid ground.

That reinforced the view that the Fed may not cut rates as quickly as previously expected... and sent the 10-year Treasury yield to over 4.1%, its highest level this year.

Shares of rate-sensitive megacaps Alphabet, Amazon and Nvidia all dipped between a half and one percent.

Shares of Tesla dropped 2% after the electric-vehicle maker slashed prices of its Model Y cars in Germany a week after reducing prices for some models in China.

U.S. stocks in recent weeks have relinquished some gains from a strong end to 2023, but should rebound in the second half of 2024, says Rob Sluymer, Technical Strategist at RBC Wealth Management.

"When you look at the 4th year of the election cycle, which is the year that we're in, the first half of the year tends to be pretty choppy. Really a broad trading range, but it tends to resolve to the upside as that uncertainty starts to resolve itself. Maybe a little bit different this year, but in general what you see is equity markets are up on average 7% in the election year, with the median up about 10%. And that's very much in line with some of our cycle work that we're looking at."

In other company news, Spirit Airlines tumbled 22%, down sharply for a second day after a U.S. judge on Tuesday blocked JetBlue from acquiring the carrier.

Shares of Ford lost more than 1.5% after UBS downgraded the stock to "neutral" from "buy."

And Boeing gained more than 1% after the Federal Aviation Administration said inspections of an initial group of 737 MAX 9 airplanes had been completed.