Analysts described rising skepticism about the likelihood of US tax reform will be approved, following news the Senate bill would link the legislation to controversial Republican health care proposals.
Other factors behind the drop included another retreat in oil prices and lackluster US retail sales and inflation data. The decline also came as bourses in Paris, London and Frankfurt fell.
About 20 minutes into trading, the Dow Jones Industrial Average stood at 23,269.88, down 0.6 percent.
The broad-based S&P 500 fell 0.7 percent to 2,559.97, while the tech-rich Nasdaq composite Index dropped 0.9 percent to 6.677.13.
Big-box retailer Target sank 8.4 percent after forecasting fourth-quarter comparable sales would be anywhere from flat to up two percent. The company also projected a fourth-quarter profit range that was lower than analysts expected.
Other retailers fell, including Wal-Mart Stores, Best Buy and Williams-Sonoma.