Fears of a global economic slowdown weighed on Wall Street's main indexes on Wednesday, and along with a prolonged inversion in the U.S. yield curve kept investors at bay.
Apple Inc was a bright spot, rising 1.23 percent after three straight days of losses.
The benchmark 10-year Treasury yields slid on Wednesday, but came off 15-month lows reached overnight as investors remained focused on central bank dovishness globally. The inversion, if it persists, could indicate that a recession is likely in one to two years.
U.S. stocks have been hit by worries of slowing global economic growth since last week following dour factory data from the United States, Europe and Japan, as well as weak consumer confidence numbers for March this week.
Adding to the concerns, Chinese data on Wednesday showed industrial profits shrank the most since late-2011 in the first two months of the year.
"Investors are looking at the bond markets and wondering what are they seeing that we aren't. The fixed-income markets are sensing a recession," said Matt Watson, portfolio manager for James Advantage Funds in Alpha, Ohio.
"People are worried about growth in America, Europe and China and those are the biggest concerns today."
Meanwhile, the European Central Bank became the latest central bank to delay a planned increase in interest rates amid rising threats to growth, following the Federal Reserve's stunning about-turn last week on interest rate hikes.
At 11:31 a.m. ET, the Dow Jones Industrial Average was down 151.59 points, or 0.59 percent, at 25,506.14. The S&P 500 was down 21.83 points, or 0.77 percent, at 2,796.63 and the Nasdaq Composite was down 82.51 points, or 1.07 percent, at 7,609.02.
Data showed that U.S. trade deficit dropped more than expected in January, likely as Chinese purchases of soybeans spurred a rebound in exports after three straight monthly declines.
Markets also awaited progress on trade talks between the United States and China as a new round of high-level negotiations was set to start on Thursday.
The S&P 500 airlines index rose 1.21 percent, with gains led by Southwest Airlines Co, up 1.6 percent.
Centene Corp's shares slipped 8.22 percent after the health insurer said it would buy smaller rival WellCare Health Plans Inc for $15.27 billion. Shares of WellCare jumped 9.12 percent.
Lennar Corp rose 2.72 percent as the homebuilder said it expected improving housing market even after missing Wall Street estimates for the first quarter.
Declining issues outnumbered advancers for a 1.44-to-1 ratio on the NYSE and for a 1.93-to-1 ratio on the Nasdaq.
The S&P index recorded 29 new 52-week highs and two new lows, while the Nasdaq recorded 25 new highs and 31 new lows.