Tech giants, which had soared during the past year of lockdowns, took some of the biggest losses.
Major banks were doing better than most of the market as yields rose, which allow them to charge more lucrative interest on loans.
Analysts expect consumer prices to rise as the economy recovers, but higher prices could run the risk of curtailing some spending, which the economy needs to sustain its recovery.
Rising inflation makes stocks seem more expensive, particularly high-value tech stocks that trade on the potential for their future profits in coming years.
Energy prices continued to climb following the shutdown of a major gas pipeline on the East Coast earlier in the week, and there are now reports of gasoline hoarding happening in places like North Carolina.