Wall Street moved lower ahead of Friday's speech by Federal Reserve Chair Janet Yellen who might offer clues on the timing for an interest rate hike by the central bank-which some Fed officials have recently suggested could be as early as next month.

"The rhetoric we've gotten from the Fed over the past week from numerous Fed officials ... has reminded the market that the Fed can raise rates at any meeting," Gary Pollack, head of fixed-income trading at Deutsche Bank Private Wealth Management in New York.

"We'll be waiting anxiously to hear if Ms. Yellen repeats that message, or backs away from it."

In 3pm trading in New York, the Dow Jones Industrial Average fell 0.2 per cent, while the Nasdaq Composite Index dropped 0.5 per cent. In 2.46pm trading, the Standard & Poor's 500 Index slid 0.4 per cent.

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"The market over the past several weeks has been in a holding pattern, really not doing much of anything and the reason for that is everyone is waiting to hear what Yellen is going to say," Peter Cardillo, chief market economist at First Standard Financial in New York, told Reuters. "Of course the markets might get surprised. The markets are looking for clarity and we might not get clarity."

The Dow fell as declines in shares of UnitedHealth and those of Merck, 1.2 per cent and 1.1 per cent weaker respectively, outweighed gains in shares of Wal-Mart and those of Nike, up 1 per cent and 0.8 per cent respectively.

Expectations for a Fed rate hike in September have risen to 24 per cent from 21 per cent on Tuesday, Reuters reported, citing CME Group's FedWatch.

Meanwhile a National Association of Realtors report showed that existing-home sales fell 3.2 per cent to a seasonally adjusted annual rate of 5.39 million in July, down from 5.57 million in June. It also posted the first year-over-year drop since November 2015, the NAR said.

"Severely restrained inventory and the tightening grip it's putting on affordability is the primary culprit for the considerable sales slump throughout much of the country last month," Lawrence Yun, NAR chief economist, said in a statement.

"Realtors are reporting diminished buyer traffic because of the scarce number of affordable homes on the market, and the lack of supply is stifling the efforts of many prospective buyers attempting to purchase while mortgage rates hover at historical lows."

After a difficult start to the year, the more constructive tone of markets in recent months has helped support the pricing of many of our key commodities.

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In Europe, the Stoxx 600 Index ended the day with a 0.4 per cent increase from the previous close. France's CAC 40 index and Germany's DAX index each added 0.3 per cent.

The UK's FTSE 100 index fell 0.5 percent as mining stocks weighed on the market.

Glencore shares slid, closing 3.1 per cent lower in London, after the company reported a drop in first-half profit and said it plans to lower its debt load more than previously announced.

"After a difficult start to the year, the more constructive tone of markets in recent months has helped support the pricing of many of our key commodities," Chief Executive Officer Ivan Glasenberg said in a statement.

"While we are highly cash generative at current spot prices, we remain mindful that underlying markets continue to be volatile. We are alert to and have a high degree of proven flexibility in adapting to changing market conditions."