Networking and semiconductor stocks also saw considerable weakness, contributing to the drop by the tech-heavy Nasdaq.
All four indexes closed at record highs Tuesday. The Standard & Poor's 500 index lost 5 points, or 0.2 percent, to 2,360. (XOM) rose 1.1%, while shares of Transocean Ltd. (RIG) gained 5% and Valero Energy Corp.(VLO) advanced 1.3%. Bristol-Myers stock has plunged as investors worry that its lung cancer drug Opdivo will lose sales to other treatments.
Kraft Heinz shares were the top drag on the S&P, falling 3.7 percent after the company walked away from its $143 billion offer to buy Unilever, a day after the Anglo-Dutch company rejected the proposal.
China's main share indexes rose for a third day approaching three-month highs, though gains were capped as speculators sold some recently-listed financial sector stocks. The company forecast greater costs, and it also took $970 million in charges that are related to expenses at a mine it is closing. The major index futures are now pointing to a higher open for the markets, with the Dow futures up by 36 points.
OIL: Energy companies traded lower as benchmark USA crude lost 74 cents, or 1.4 percent, to $53.59 a barrel in NY.
West Texas Intermediate and Brent crude were up 1.3% to $54.33 a barrel and $56.57. Its stock gave up $1.96, or 5.2 percent, to $35.48. Crude oilclimbed 1.4%, shrugging off data that showed crude inventories rose by 600,000 barrels in the latest week, a bearish sign for demand. Other homebuilders including Lennar and PulteGroup made smaller gains. Chair Janet Yellen indicated that is likely if the job market remains healthy and inflation keeps rising. Revenue for Papa John's worldwide wasn't as good as investors hoped, and its shares gave up $7.36, or 8.6 percent, to $78.27. Though higher rates tend to weigh on stocks, the Fed's confidence and broader optimism about the economy have buoyed markets.
BONDS: Bond prices rose. The yield on the 10-year Treasury note fell to 2.41% from 2.43% late Tuesday. Against the euro, the dollar is valued at $1.0584 compared to yesterday's $1.0558.
Exxon Mobil gained one percent while Chevron added 0.6 per cent and ConocoPhillips rose 0.4 per cent.
OVERSEAS: Britain's FTSE 100 was up 0.1 percent and France's CAC 40 shed 0.4 percent.
In Japan, the Nikkei 225 traded down 0.35%, while across the Korean Strait, the Kospi was fractionally lower at 2,106. Hong Kong's Hang Seng index jumped 1 percent.