The stock market could suffer further declines should one of three major things happen Thursday, veteran trader Art Cashin told CNBC.
Perhaps Wall Street's biggest concern, though, is whether a jump in labor costs will force the Federal Reserve to hike interest rates sooner rather than later, the director of floor operations at the NYSE for UBS said on "Squawk on the Street."
The Labor Department reported U.S. labor costs rose the most in nearly six years in the second quarter, with the Employment Cost Index, or ECI, climbing 0.7 percent. That was the biggest jump since the third quarter of 2008.
Read MoreUS labor costs jump
"Immediately that started 'the Fed's behind the curve' talk again and we took the yield on the 10-year dangerously close to 2.6 [percent]," Cashin said.
"The great thing to worry about here is if it begins to look like the Fed has lost control," he said.
A second headwind for the markets is Argentina's credit default, Cashin said. The default, Argentina's second in 12 years, will raise the country's borrowing costs, add to pressure on the peso, drain dwindling foreign reserves and fuel one of the world's highest inflation rates.
Thankfully, Cashin said, "that feeling of contagion hasn't really spun out quite yet."
Finally, Cashin recommended investor pay special attention to the technicals. To Cashin, "the critical area" for the S&P 500 index is the 1,950 to 1,953 range.
"If they don't hold 1,950, it's going to be a bit of a problem," he said.
—By CNBC's Drew Sandholm, with Reuters.