The Dow Jones Industrial Average was down 171.69 points, or 0.50 percent, to 33,980.32. The S&P 500 fell 31.16 points, or 0.72 percent, to 4,274.04. The Nasdaq Composite Index was down 164.43 points, or 1.25 percent, to 12,938.12.
Ten of the 11 primary S&P 500 sectors ended in red, with communication services and materials down 1.85 percent and 1.4 percent, respectively, leading the laggards. Energy rose 0.81 percent, the lone gaining group.
The Fed's July meeting minutes released Wednesday showed that the central bank would continue its interest rate hiking campaign to tame inflation.
"Participants continued to anticipate that ongoing increases in the target range for the federal funds rate would be appropriate to achieve the committee's objectives," said the minutes.
Meanwhile, Fed officials signaled greater caution with the pace of coming increases.
"Participants judged that, as the stance of monetary policy tightened further, it likely would become appropriate at some point to slow the pace of policy rate increases while assessing the effects of cumulative policy adjustments on economic activity and inflation," the minutes said.
"While the FOMC (Federal Open Market Committee) minutes continue to emphasize the need to contain inflation, there is also an emerging concern the Fed could tighten more than necessary," Chris Low, chief economist at FHN Financial, said in a note on Wednesday.
Last month, the Fed enacted its second consecutive 75 basis point interest rate hike as it sought to tamp down runaway inflation.
On the economic front, the U.S. Commerce Department reported Wednesday that U.S. retail sales were flat in July amid lower gas prices, after rising by a revised 0.8 percent in the prior month.
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