The Dow dropped half of one percent while the S&P 500 and Nadsaq slid about six tenths each.

U.S. 10-year yields hit a session high above 4.7% after a U.S. treasury auction. Will Rhind, CEO of ETF company GraniteShares said he is paying close attention to the moves.

"Clearly what has sort of stalled the stock market rally, at least over the last few weeks has been rising yields and I think that the rising yield yields has been something that clearly is you know, first and foremost or front and center of investors' minds. Given that, you know, the interest rate, right, the interest rate hikes that we've seen, you know, have been very high. But obviously the further that or the higher that rates go from here, the more chance there is of something breaking in the system and a recession or something deeper happening."

A surprise jump in rental costs pushed consumer prices higher last month, while the annual increase in the core figure, which excludes volatile food and energy components, was the smallest in two years.

Traders now see a stronger chance the Fed might end up delivering another interest-rate hike this year, after looking at Thursday's data.

Stocks on the move included Fastenal. Shares of the industrial supplies company rose nearly eight percent after it topped earnings expectations.

And shares of Ford lost two percent after the United Auto Workers union expanded its strike at the company's biggest and most profitable factory.

The focus shifts to earnings Friday as big banks including JP Morgan Chase and Wells Fargo report quarterly results before the opening bell.