The Dow Jones industrial average (INDU) fell 17 points, or 0.1%, to 12,409; the S&P 500 (SPX) dropped 2 points, or 0.2%, to 1,334; and the Nasdaq Composite (COMP) lost 3.6 points, or 0.1%, to 2,796.
Also weighing on the market were oil prices, which rose above the $110-a-barrel mark in afternoon trading. Oil for delivery in May rose $1.41, or 1.3%, to $110.24 a barrel - it's highest level since September 2008.
"With this earthquake and oil, there's no fuel for this market to go higher," said Stephen Carl, head trader at Williams Capital.
nvestors mostly took a cautious approach ahead of earnings season, which has its unofficial kick off Monday, when Dow component Alcoa (AA, Fortune 500) reports.
"There are a lot of things that could influence the market right now -- oil, Libya, a budget deal out of Congress -- but corporate earnings are going be the catalyst to get stocks going higher," Zemsky said.
With the S&P 500 continuing to nudge up against the key 1,340 level, Financial Enhancement Group market analyst Joe Clark said investors are feeling a stronger pull toward selling and are just waiting for a reason to follow through.
The 1,340 level on the S&P has been a resistance point for stocks since mid-February, when the S&P 500 hit its high for the year.
Investors are also mulling Thursday's decision by the European Central Bank to raise its key lending rate to 1.25%.
Like the Federal Reserve, the ECB and Bank of England have each kept interest rates at historic lows for the past three years as a way to spur economic activity following the financial crisis and subsequent recession.
But rising energy and food prices have raised fears that inflation could be become unwieldy, at a time when economic growth is still sluggish. Central banks use higher interest rates to deal with inflation, but higher interest rates also slow economic growth.
Gold futures for June delivery rose 80 cents to $1,459.30 an ounce, a day after hitting a new intraday record of $1,463.70 an ounce.
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