Weakness in emerging market currencies offered some support to the dollar, which retreated modestly, as the euro rose and Britain's sterling regained some ground in volatile trading after a four-day losing streak.
The United States and Canada resumed talks about revamping the North American Free Trade Agreement (NAFTA). Canada insisted there was room to salvage the pact despite few signs a deal was close. US President Donald Trump said talks with Canada were coming along.
A public comment period on the possibility of fresh US tariffs on another $200 billion of Chinese goods ends on Thursday, with expectations that Trump will impose the additional levies.
The deadline weighed on MSCI's emerging markets equities index, which fell 1.7 percent in line with a drop in the Shanghai SE Composite index.
"The linchpin will be China," said Sameer Samana, global equity and technical strategist for Wells Fargo Investment Institute, in St. Louis, adding that if China continues to grow, other emerging market countries could regain ground.
"We're actually kicking the tires to see where there's value," Samana said.
On Wall Street, the Dow Jones Industrial Average rose 22.51 points, or 0.09 percent, to 25,974.99, the S&P 500 lost 8.12 points, or 0.28 percent, to 2,888.6 and the Nasdaq Composite dropped 96.07 points, or 1.19 percent, to 7,995.17.
Along with global concerns, US politics were preying on investors minds with issues including upcoming mid-term elections and controversies around President Donald Trump, according to Rick Meckler, partner, Cherry Lane Investments, a family investment office in New Vernon, New Jersey.
"In the absence of an earnings season, politics will be a bigger factor in this market up until the midterms. In general people feel somewhat uneasy. There's underlying nervousness about politics, interest rates and emerging markets."
The pan-European FTSEurofirst 300 index lost 1.20 percent and MSCI's gauge of stocks across the globe shed 0.61 percent.
Emerging market currencies showed a second day of declines, with a JPMorgan emerging market currency index falling 0.2 percent on fears export-oriented economies would be caught in the crossfire of any escalating trade conflict.
Sterling was last trading at $1.2908, up 0.42 percent on the day as investors positioned for a favorable Brexit outcome even after Germany appeared to shoot down an earlier report that Berlin and London might abandon key Brexit demands.
Measured against a basket of currencies, the dollar index fell 0.34 percent, with the euro up 0.42 percent to $1.163.
Benchmark 10-year notes last rose 1/32 in price to yield 2.9004 percent, from 2.902 percent late on Tuesday. The 30-year bond last fell 3/32 in price to yield 3.0737 percent, from 3.069 percent late on Tuesday.
Oil prices fell after a US Gulf storm weakened and moved away from oil-producing areas and as concerns mounted about global trade disputes and Turkey's currency crisis hurting demand.
US crude fell 1.39 percent to $68.90 per barrel and Brent was last at $77.35, down 1.05 percent on the day.