WASHINGTON (dpa-AFX) - After coming under pressure early in the session, stocks have regained some ground over the course of the trading day on Thursday. The major averages have climbed off their worst levels of the day but currently remain in negative territory.
Currently, the Dow is down 127.90 points or 0.2 percent at 52,347.20 and the S&P 500 is down 23.63 points or 0.2 percent at 7,720.35. The tech-heavy Nasdaq is posting a more significant loss, down 335.37 points or 1.3 percent at 26,214.48.
The steep drop by the Nasdaq comes amid a nosedive by shares of Alphabet (GOOGL), with the Google parent plummeting by 11.7 percent to its lowest intraday level in almost seven months.
Alphabet has plunged after the company reported weaker-than-expected third quarter revenue as well as negative free cash flow.
'Vast spending on AI seems to be tolerated by investors if companies' earnings are unblemished,' said AJ Bell investment director Russ Mould. 'This is where Google-owner Alphabet has fallen down.'
He added, 'While overall revenue was solid in the quarter, the company saw weakness in its core search advertising business as it burns through cash at rates which would make the main character in Brewster's Millions blush.'
Shares of Caterpillar (CAT) have also moved sharply lower on the day, with the construction equipment maker tumbling by 7.7 percent even though the company reported better-than-expected third quarter earnings and revenue.
On the U.S. economic front, a closely watched report released by the Commerce Department showed consumer prices in the U.S. increased in line with economist estimates in the month of September.
The Commerce Department said its personal consumption expenditures (PCE) price index climbed by 0.5 percent in September after rising by 0.3 in August. The increase matched expectations.
The report also said the annual rate of growth by the PCE price index accelerated to 3.6 percent in September from 3.4 percent in August, while was also in line with estimates.
Excluding food and energy prices, the core PCE price index rose by 0.3 percent in September, matching an upwardly revised increase in August as well as expectations.
The annual rate of growth by the core PCE price index ticked up to 3.1 percent in September from 3.0 percent in August. The uptick also came in line with economist estimates.
Meanwhile, a separate Commerce Department report showed economic growth in the U.S. exceeded economist estimates in the third quarter of 2026.
Sector News
Software stocks have shown a substantial move to the downside on the day, with the Dow Jones U.S. Software Index plunging by 2.8 percent.
Significant weakness is also visible among gold stocks, as reflected by the 2.5 percent slump by the NYSE Arca Gold Bugs Index.
On the other hand, housing stocks have moved sharply higher on the day, resulting in a 3.5 percent surge by the Philadelphia Housing Sector Index.
Pharmaceutical stocks are also seeing considerable strength on the day, driving the NYSE Arca Pharmaceutical Index up by 3.4 percent.
Eli Lilly (LLY) has helped to lead the sector higher, with the drugmaker soaring by 6.7 percent after reporting better than expected third quarter results.
Airline, healthcare and commercial real estate stocks are also seeing notable strength, helping limit the downside for the broader markets.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan's Nikkei 225 Index jumped by 1.1 percent, while China's Shanghai Composite Index slid by 0.8 percent.
Meanwhile, the major European markets have all moved to the upside on the day. While the U.K.'s FTSE 100 Index is up by 0.4 percent, the French CAC 40 Index is up by 1.1 percent and the German DAX Index is up by 1.4 percent.
In the bond market, treasuries have moved sharply higher after ending the previous session firmly in the red. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 7.5 basis points at 4.970 percent.
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