Stocks retreat as small-caps underperform
Cyclical stocks, which are tied to the pace of economic growth, ranked among the weakest of the day.
The Russell 2000 fell 1.8 percent, its biggest percentage drop since April 25.
Wall Street hit a number of milestones on Thursday, the final session before the Independence Day holiday, with the Dow topping 17,000 for the first time and the S&P 500 closing at a record high after a strong June jobs report.
Action may pick up later this week with the release of quarterly results from Alcoa Inc and Wells Fargo & Co.
Dozens of major companies are scheduled to report next week, including numerous Dow components. Profits are forecast to grow 6.2 percent for the quarter, according to Thomson Reuters data, but investors see a slight chance that profits could return to double-digit growth for the first time in nearly three years.
The S&P 500 declined 7.79 points or 0.39 percent, to 1,977.65.
The Nasdaq Composite dropped 34.40 points or 0.77 percent, to 4,451.53.
As the June payrolls report confirmed expectations that the economy rebounded in the second quarter, some analysts thought the data could prompt the U.S. Federal Reserve to raise interest rates sooner than anticipated.
BioDelivery Sciences International Inc shares surged 8.9 percent to $13.06 after the company said its experimental pain drug, which it made with Endo International Plc, was found effective in a late-stage trial.
Volume was light, with only about 4.81 billion shares traded on U.S. exchanges, well below the 5.8 billion average in June, according to data from BATS Global Markets.