Stocks fell on Wednesday, with the major indexes posting their third consecutive decline, as investors took a breather following sharp gains this year. Wall Street also sought further indications that a trade deal between China and the U.S. could be reached in the near future.
The Dow Jones Industrial Average pulled back 133.17 points to 25,673.46 as Walgreens Boots Alliance lagged. The S&P 500 fell 0.65 percent to 2,771.45, led by declines in the energy and health care sectors. The Nasdaq Composite declined 0.9 percent to 7,505.92, notching its first three-day losing streak of the year.
Dow Transports, meanwhile, dropped half a percent to post its ninth straight decline, its longest slide since 2009. Small cap stocks also closed lower, with the Russell 2000 sliding 2 percent.
The S&P 500 energy sector fell more than 1 percent as U.S. crude prices were under pressure amid a surge in supply. The Energy Information Administration said crude inventories spiked by 7.1 million barrels last week, sending prices down 0.6 percent.
Health-care stocks in the S&P 500 pulled back more than 1 percent. Shares of Nektar Therapeutics and HCA Healthcare dragged down the sector, falling more than 4 percent each.
"Most of the big items that have driven the market over the past two months are done," said Tom Martin, senior portfolio manager at Globalt. "The market is guessing there will be some sort of trade deal that will end the larger hostilities."
"The news has people waiting; that's what you're seeing in the averages over the last several days," Martin said.
Three sources told CNBC that President Donald Trump wants the U.S. and China to strike a deal in hopes of boosting stock prices ahead of the 2020 election. The sources said Trump thinks getting a deal on trade would accomplish that.
Earlier this week, sources told CNBC the U.S. and China were in the "final stages" of trade talks, with the two sides planning a Mar-a-Lago summit for the end of the month. U.S. Secretary of State Mike Pompeo also said Monday he thought Washington and Beijing were "on the cusp" of reaching a deal.