U.S. equities posted their worst day of the year Tuesday as banks faced pressure from falling yields, while investors turned their eyes to a key House vote.

The Dow Jones industrial average fell around 240 points, with Goldman Sachs contributing the lion's share of the losses. The S&P 500 dropped 1.2 percent, with financials falling more than 2.5 percent to lead decliners. The indexes were also posted their first decline of at least 1 percent since October.

"We're settling back into the middle of the range in the 10-year yield. That certainly has taken the air out of financials lately," said Art Hogan, chief market strategist at Wunderlich Securities.

U.S. Treasury yields traded mixed, with the benchmark 10-year note yield holding around 2.42 percent and the short-term two-year note yield trading around 1.26 percent.

Yields have been falling since last week, when the Federal Reserve raised rates but provided a more dovish outlook than expected.Weaker yields lead to lower interest rates on loans, which hurt financial stocks, particularly banks.

"I'm not overly worried about [financials'] price action today," said Mark Spellman, portfolio manager at Alpine Funds, noting that the economic backdrop remains bullish for the sector.

The SPDR S&P Bank ETF (KBE) and the Regional Banking ETF (KRE) both fell more than 4.5 percent.

10-year yield in 2017