U.S. stocks declined Thursday as a renewed selloff in semiconductor shares overshadowed positive earnings reports. The Dow Jones Industrial Average fell 0.20%, the S&P 500 dropped 0.51%, and the Nasdaq Composite saw a more significant drop of 1.47%. The PHLX Semiconductor Index plunged 4.3%, impacting major chipmakers like Sandisk, Seagate, Micron, Intel, and AMD.

This downturn follows a report from Goldman Sachs indicating a decrease in hedge fund exposure to AI-related stocks, suggesting investors are realizing profits after a substantial rally. The selloff occurred despite Taiwan Semiconductor Manufacturing reporting its fifth consecutive quarter of record earnings, with a 77% profit increase.

In related news, South Korea is tightening regulations on leveraged ETFs tied to chip stocks to curb volatility. Meanwhile, United Health raised its earnings forecast, and GE Aerospace updated its outlook, though supply chain issues persist. Eli Lilly announced a deal to acquire Atai Beckley for at least $2.8 billion.