The Dow Jones Industrial Average dropped 543.34 points, or 1.51 percent, to 35,368.47. The S&P 500 fell 85.74 points, or 1.84 percent, to 4,577.11. The Nasdaq Composite Index decreased 386.86 points, or 2.60 percent, to 14,506.90.
Ten of the 11 primary S&P 500 sectors ended in red, with technology and financials down 2.49 percent and 2.3 percent, respectively, leading the laggards. Energy rose 0.4 percent, the lone gaining group.
Shares of Goldman Sachs Group tumbled nearly 7 percent after the bank reported quarterly earnings on Tuesday that missed market expectations.
Tech stocks got hit amid a momentum in U.S. treasury yields as investors are preparing for Federal Reserve's policy tightening.
U.S.-listed Chinese companies traded mostly lower with eight of the top 10 stocks by weight in the S&P U.S. Listed China 50 index ending the day on a downbeat note.
U.S. financial markets were closed Monday due to the Martin Luther King Jr. holiday.
For the week ending Friday, the Dow dipped 0.88 percent, the S&P 500 fell 0.3 percent and the tech-heavy Nasdaq slid 0.28 percent.
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