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US stocks slipped on Wednesday as investors absorbed a report that President-elect Donald Trump is considering declaring a national economic emergency to pave the way for proposed tariffs.

The S&P 500 ( ^GSPC ) fell 0.2% while the tech-heavy Nasdaq Composite ( ^IXIC ) fell 0.2%. The Dow Jones Industrial Average ( ^DJI ) dropped more than 100 points, or nearly 0.3%.

Meanwhile, the 10-year Treasury yield ( ^TNX ) jumped as high as 4.72% to hold near an eight-month highs.

Trump is looking to the emergency powers to provide a legal basis for his proposed hefty and wide-ranging tariffs , CNN reported . The news jolted markets already on guard for Trump economic surprises as Inauguration Day nears, bracing for a wave of policy moves and executive orders.

Investors are keeping a close eye on prospects for the economy as they gauge shifts in the chances of slower interest-rate cuts this year. Federal Reserve minutes due later could reset their bets.

Stocks sold off and the benchmark Treasury yield spiked on Tuesday as service sector and labor market readings revived concerns over stubborn inflation. The data gives weight to Fed officials' hints that they will lower rates slower than foreseen, and traders now see a less than 50% chance of any easing before June, according to the CME FedWatch tool.

Markets could switch back to viewing strong economic data releases as negative and a spur to "higher for longer" rates, some analysts believe.

US private companies slowed their headcount growth in December, signaling moderating demand for hiring. According to ADP Research Institute data, private firms added 122,000 jobs in December, the lowest amount since August.

But the number of Americans making jobless claims fell unexpectedly last week, pointing to a stable labor market, official figures showed . The data was released a day early as government offices are closed for a national day of mourning for former President Jimmy Carter on Thursday.

That labor data, along with the release of Fed minutes on Wednesday afternoon, will feed into expectations for the crucial December jobs report release on Friday.

Meanwhile, Nvidia ( NVDA ) stock nudged higher as it struggled to recover from a rout that erased $220 billion in market value.