WASHINGTON (dpa-AFX) - After trending higher over the past few sessions, the major U.S. stock indexes moved back to the downside during trading on Thursday. The tech-heavy Nasdaq showed a particularly steep drop on the day.
The Nasdaq tumbled 365.13 points or 1.4 percent to 26,184.72, giving back ground after surging by 2.3 percent over the three previous sessions. The S&P 500 also dipped 23.59 points or 0.3 percent to 7,720.39, while the Dow fell 132.54 points or 0.3 percent to 52,342.56.
The sharp pullback by the Nasdaq came as technology stocks came under pressure as concerns about artificial trade once again resurfaced on Wall Street.
Google parent Alphabet (GOOGL) led the way lower, plunging by 13.2 percent after reporting weaker-than-expected third quarter revenue as well as negative free cash flow.
'Alphabet's accelerated cash burn might have been overlooked if the rest of its update had reassured investors that the money being spent is delivering, but shares in the company slid 13%, dragging down many of its tech heavy peers,' said Danni Hewson, head of financial analysis at AJ Bell.
Shares of Caterpillar (CAT) also moved sharply lower on the day, with the construction equipment maker tumbling by 9.6 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
Despite the pullback by the major averages, housing stocks moved sharply higher amid a decrease in treasury yields, with the Philadelphia Housing Sector Index spiking by 3.8 percent.
Substantial strength was also visible among pharmaceutical stocks, as reflected by the 3.4 percent surge by the NYSE Arca Pharmaceutical Index.
Eli Lilly (LLY) helped to lead the sector higher, soaring by 6.8 percent after reporting better than expected third quarter results.
Airline, healthcare and commercial real estate stocks also saw considerable strength, while gold stocks moved sharply lower amid a decrease by the price of the precious metal, dragging the NYSE Arca Gold Bugs Index down by 3.2 percent.
Software, computer hardware and semiconductor stocks also showed notable moves to the downside, contributing to the slump by the Nasdaq.
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 all moved to the upside on the day. While the U.K.'s FTSE 100 Index rose by 0.3 percent, the French CAC 40 Index shot up by 1.1 percent and the German DAX Index surged by 1.3 percent.
In the bond market, treasuries moved notably 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, slid 5.6 basis points to 4.989 percent.
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