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US stocks fell on Thursday, hit by nervousness ahead of Friday's jobs report and lingering uncertainty over a Greece aid deal with creditors.
Declining oil and gold prices also weighed on energy and materials shares, which led declines in the benchmark S&P 500.
Data showed the labour market tightening, with first-time applications for unemployment aid down last week and the number of people on benefit rolls hitting the lowest level since 2000, suggesting the Federal Reserve will remain on track to raise interest rates later this year.
Key jobs report
The data came ahead of Friday's key US jobs report, expected to show a 225,000 gain in non-farm payrolls, according to a Reuters estimate.
"The concern is tomorrow and the jobs number, that is where all the focus is," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York. "Probably the concern (is) that it is going to be a good number."
Some investors think stronger jobs numbers could increase chances the Fed might raise rates sooner rather than later.
Greece debt payment
Adding to investor concerns, Greece delayed a debt payment to the International Monetary Fund due on Friday and German Chancellor Angela Merkel said talks on a cash-for-reforms deal were still far from an agreement.
The Dow Jones industrial average fell 170.69 points or 0.94 per cent to 17,905.58, the S&P 500 lost 18.23 points or 0.86 per cent to 2,095.84 and the Nasdaq Composite dropped 40.11 points or 0.79 per cent to 5,059.13.
Investors also digested the International Monetary Fund's comment urging the Fed not to raise rates until there are clear signs of a pick-up in wages and inflation.
In a bearish sign, the S&P 500 closed below its 50-day moving average, a key technical indicator.
The S&P materials index fell 1.3 per cent, while the energy index declined 1.2 per cent. Oil prices eased for a second day ahead of an OPEC decision which could keep the market oversupplied.
Shares of chemical maker LyondellBasell Industries lost 3.2 per cent at $99.48, leading declines in the materials sector.
Delta Air Lines Inc dipped 0.7 per cent to $42.92 after it said its operating profit margin this quarter could be lower than it expected, with airlines hit by weaker US demand. Shares of American Airlines dropped 2.2 per cent to $42.17.
On the plus side, Five Below shares jumped 7.6 per cent to $37.77 after the teen merchandise retailer increased its full-year forecast.
After the bell, shares of Zumiez dropped 8.4 per cent to $27.25 as it estimated current-quarter profit and revenue below analysts' expectations.
During the session, declining issues outnumbered advancing ones on the NYSE by 2,374 to 677, for a 3.51-to-1 ratio; on the Nasdaq, 1,994 issues fell and 769 advanced for a 2.59-to-1 ratio favouring decliners.
The S&P 500 posted four new 52-week highs and six new lows; the Nasdaq Composite recorded 83 new highs and 32 new lows.
About 6.3 billion shares changed hands on US exchanges, slightly above the 6.2 billion average for the last five sessions, according to BATS Global Markets.
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