U.S. stocks closed mostly lower Thursday as modest gains in financial stocks failed to offset declines in health care and utilities stocks.
Utilities closed nearly 1.1 percent lower as the worst performer in the S&P 500, followed by the health care sector, which lost 0.9 percent. Within health care, shares of Biogen led declines, dropping nearly 4.7 percent after Morgan Stanley downgraded the stock to equal weight.
Analysts also attributed the overall health care sector losses to President Donald Trump's budget blueprint, released Thursday, that proposed cutting the National Institutes of Health's (NIH) spending by $5.8 billion.
"The proposed cut in the NIH budget is pretty significant and I don't know if it will happen," said Paul Yook, portfolio manager at BioShares Funds. "The NIH is a $32 billion budget. It was expected to increase 3 percent. To have it slashed by 18 percent, $6 billion, is a tremendous change."
Earlier, the health care sector hit a fresh high going back to August 2015.
The Nasdaq composite eked out a gain in the close, ending within a quarter percent of its all-time intraday high. The Dow and S&P closed within 1.5 percent of their record highs.
"The market saw a bullish reaction to the Fed's announcement yesterday, allowing the S&P futures to clear intraday resistance. The ratio of up- to down-volume was better than 5-to-1, setting the stage for upside follow-through today," Katie Stockton, chief technical strategist at BTIG, said in a note. However, she still expects stocks to remain in "pullback-mode until short-term momentum improves."
U.S. crude oil futures reversed earlier gains settle down 11 cents at $48.75 a barrel. WTI snapped a seven-day losing streak Wednesday after weekly inventory data showed a drawdown in stockpiles.
In corporate news, Toronto-based luxury apparel maker Canada Goose went public on the New York Stock Exchange Thursday. Shares opened at US$18 and closed at $16.08, about 25 percent above their IPO price. Canada Goose will also trade on the Toronto Stock Exchange.
Shares of Snap, another recent IPO and the parent of Snapchat, dropped 4.2 percent to close below $20 a share.