NEW YORK: Wall Street fell on Wednesday after stronger-than-expected services sector data fueled concerns of sticky inflation and interest rates staying higher for longer, while a drop in shares of Apple further weighed down the indexes.

The Institute for Supply Management (ISM) said on Wednesday its non-manufacturing PMI rose to 54.5 last month against expectations of 52.5, while a gauge of prices paid by service-sector businesses for inputs increased. Traders’ bets for a pause in interest rate hikes in the central bank’s September meeting stood at 91%, with bets on a pause in November slipping to 46.8% from nearly 57% before the data, according to the CME FedWatch Tool.

“Everybody has been kind of getting in the camp that we’re done with rate hikes but when you see something like that (stronger-than-expected economic data), they do get a little nervous,” said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.

“Every Fed governor comes out and says they look for the data and that data point today is definitely something that’s a little bit more inflationary.”

Boston Fed President Susan Collins stressed on the need for the central bank to “proceed carefully” as it takes its next monetary policy steps. Apple was the biggest drag across the three major indexes, down 3.0% after a report said China had banned officials at central government agencies from using iPhones and other foreign-branded devices for work.

At 11:47 a.m. ET, the Dow Jones Industrial Average was down 194.34 points, or 0.56%, at 34,447.63, the S&P 500 was down 35.48 points, or 0.79%, at 4,461.35, and the Nasdaq Composite was down 147.96 points, or 1.06%, at 13,872.99.

Lockheed Martin dropped 4.0% after the US weapons maker trimmed the delivery outlook for its F-35 jets.

The S&P index recorded three new 52-week highs and 24 new lows, while the Nasdaq recorded 32 new highs and 119 new lows.