NEW YORK — Stocks slumped on Wall Street Thursday, suggesting that the rally which has pushed indexes close to record levels may have run its course.
The Dow Jones industrial average fell 46 points to 13,942, having earlier slid as much as 134 points. The index has traded largely sideways this week, after logging its best January in almost two decades.
The Standard and Poor's 500 fell 4 points to 1,508 and the Nasdaq composite dropped 11 points to 3,157.
"We had such a big January, some type of weakness, or consolidation, make sense here to us," said Ryan Detrick of Schaeffer's Investment Research in Cincinnati.
The S&P 500 has lost an average of 0.58 percent in February over the last 20 years, making it the weakest month for stocks, according to research by Schaeffer's.
Stocks fell as weaker earnings and worries about Europe overshadowed healthier signs for the U.S. economy.
Fewer Americans sought unemployment benefits last week, a sign that layoffs are easing. Applications for unemployment benefits fell 5,000 to 366,000.
But the stock price of News Corp. fell 70 cents to $27.52 after the media conglomerate cut its forecast for annual earnings. Weakness at several businesses, including its Fox broadcast network, should offset a gain in earnings in the most recent quarter.
Investors also worried about comments from European Central Bank president Mario Draghi. He pledged to keep a close eye on the rising euro, fearing that the currency's rally in recent month could hurt exports and further harm the region's fragile economy.
"You could have very weak growth in Europe for the next five or ten years," said Michael Sheldon, chief strategist at RDM Financial Group. "There's a lot of austerity going through the European markets, so it's going to be a long time before they re-establish themselves."
Most of Europe's major stock indexes ended the day lower. Only Germany and Greece bucked the trend.
Europe has returned to investor's radars after several months of relative quiet. Stocks fell on Monday, partly because of a spike in borrowing costs for Italy and Spain. That reignited concerns that those countries won't be able to service their debts.
Still, some say that the decline is more of a pullback than a sell-off. That will give investors a chance to buy stocks at lower prices in anticipation of the market resuming its rally.
Stocks have jumped this year on optimism that the housing market will sustain its recovery and the job market will slowly heal. Corporate earnings growth has also accelerated.
"There's really nothing new to worry about it," said Sam Stovall, chief equity strategist at S&P Capital IQ.
As stocks fell Thursday, bonds rallied. The yield on the 10-year Treasury note, which moves inversely to its price, fell 1 basis point to 1.95 percent.
Among other stocks making big moves:
_ Akamai Technologies Inc., which helps websites deliver online content, plunged $6.47 to $35.10, after reporting earnings late Wednesday. Net income rose, but revenue missed forecasts.
_ Sprint Nextel Corp., the country's third-largest wireless carrier, fell 7 cents to $5.71. Sprint lost $1.3 billion in its fourth quarter as it revamped its network to take on its larger competitors. The company also lost 243,000 customers in contract-based plans in the quarter.
_ DeVry, a for-profit education company, surged $4.38 to $30.50 after the company revenues dropped for the sixth straight quarter as fewer students enrolled in its classes. But the decline wasn't as bad as analysts had expected and there were signs of improvement in some student trends.
_ Auto parts retailer O'Reilly Automotive surged $7.61 to $100.2 after its earnings beat Wall Street forecasts.