Investors will be looking ahead to next week's Federal Open Market Committee meeting amid expectations that the central bank could announce a tapering of its bond-buying program.
"The Fed may still be quite dovish and give the market a taper that's on the lighter side—the consensus is around $10 billion," said Quincy Krosby, market strategist at Prudential Financial. "If the Fed comes in with something much stronger than what the markets anticipate, you're going to see Treasury yield climb and that could create a bit of uncertainty in the equity market."
President Obama addressed the nation in a televised speech from the White House on Tuesday evening, saying he would work with allies to force Syria to hand over its chemical weapons. His comments came after Damascus accepted Moscow's proposal to hand over its weapon stockpile in a bid to avoid a U.S.-led attack. Obama voiced skepticism the strategy would work, however, and urged war-weary Americans to support the use of military force if necessary.
Apple tumbled more than 5 percent a day after the tech giant unveiled two new iPhones. Disappointment over the pricing of the lower-costing iPhone 5C weighed on the company's shares, according to market watchers who said the price tag may be too high and may limit sales in key emerging markets.
BofA Merrill and Credit Suisse cut their ratings on the stock to "neutral," while at least four brokerages lifted their price targets.
(Read more: Would you buy the new low cost iPhone?)
Morgan Stanley edged higher after UBS upgraded the bank to a "buy" rating with a $33 price target, citing its increasingly wealth management-driven business model. Meanwhile, the brokerage downgraded BlackRock to a "neutral" rating, with a $280 target.
Verizon Communications officially launched a massive bond sale, offering $49 billion worth of debt in the biggest-ever corporate issue on record. The deal tops Apple's previous record of a $17-billion offering back in May. The telecoms giant will use the proceeds to replace a bridge loan used to finance its acquisition of Vodafone's stake in Verizon Wireless.