Wall Street drops as investor jitters climb before CPI data Friday; 10-year yield rises

Adding to nervousness, the benchmark U.S. 10-year Treasury yield climbed to as much as 3.073%, its highest level since May 11.

All three of the major indexes registered their biggest daily percentage declines since mid-May. The S&P 500 is down 15.7% for the year so far and the Nasdaq is down about 25%.

Higher-than-expected inflation readings could increase fears that the U.S. Federal Reserve will raise interest rates more aggressively than previously expected.

The central bank has raised its short-term interest rate by three-quarters of a percentage point this year and intends to keep at it with 50 basis points increases at its meeting next week and again in July.