Wall Street's major indices traded lower on Wednesday as a fresh selloff in technology stocks and rising tensions between the US and Iran outweighed an inflation reading that largely matched market expectations. The Dow Jones Industrial Average was down 1.1%, the S&P 500 declined 0.9% and the Nasdaq Composite slipped over 1%.Investor sentiment has turned cautious in recent sessions amid concerns over stretched valuations in artificial intelligence-linked stocks, geopolitical uncertainty in the Middle East and expectations that the Federal Reserve could keep monetary policy tight for longer.The CBOE Volatility Index, often referred to as Wall Street's fear gauge, rose 0.78 points to 20.65 after touching its highest level since April 7 in the previous session.US consumer prices rose 4.2% in May from a year earlier, the fastest pace since April 2023, largely due to higher fuel and energy costs linked to the Middle East conflict. However, the inflation reading was in line with economists' expectations.Markets are widely expecting the Fed to leave rates on hold in June, although traders continue to price in at least one 25 basis-point rate hike by the end of the year.Technology and AI-related stocks remained under pressure as investors reassessed valuation levels in a higher interest-rate environment. Nvidia, Broadcom and Micron Technology fell between 1% and 3.8%, dragging the S&P 500 technology index down 1.1%.Super Micro Computer plunged 14.2% after announcing plans to raise $7 billion through equity and equity-linked offerings to support growing demand for its AI server business.The weakness in technology shares has triggered a rotation into defensive sectors. Healthcare, real estate and consumer staples stocks advanced, while energy shares gained more than 1% as crude oil prices moved higher.Geopolitical concerns also remained in focus after US President Donald Trump said Iran would "have to pay the price" for delaying negotiations, while Tehran indicated it would reassess diplomatic engagement following recent military exchanges.Among individual stocks, trucking companies XPO, JB Hunt and Old Dominion Freight Line fell between 2.5% and 6.2% after Amazon expanded its less-than-truckload freight business in the US.Market breadth remained weak, with declining stocks outnumbering advancing shares on both the New York Stock Exchange and the Nasdaq.