The sell off accelerated during afternoon trading. "I think it's the internals," said Art Cashin, director of floor operations for UBS. "The Nasdaq and Russell are getting creamed." Cashin and others have been pointing to the divergence between the Dow and S&P 500, both hitting highs early Thursday, and the outsized declines in the Russell 2000 and Nasdaq in recent sessions.
The Russell and Nasdaq led the market higher this year, so traders say that is the first place profits were being taken.
Like Kelly at J.P. Morgan Funds, other market strategist agreed a pause was to be expected given the market's ongoing climb, which has the S&P 500 up 23 percent for the year. "We've had such a party the last few weeks, one would think we have to take a little bit of a breather," said Bruce McCain, chief investment strategist at Key Private Bank.
Nick Raich, CEO at the Earning Scout, chalked up the market's drop to "day-to-day gyrations and profit taking after yesterday's record move by the Dow."
Twitter opened at $45.10 a share, more than 70 percent above its IPO price of $26 a share. The stock is trading under the ticker symbol "TWTR."
On an interview on CNBC, Twitter CEO Dick Costolo said investors should not be concerned about the company's current lack of profits, because it's part of a plan to invest for the long term. He also said employees had agreed to an 180-day lockup.
(Read more: Twitter Live Blog)
"I feel like I'm back in time in the 90s with a lot of these internet stocks. They are not trading off earnings, but on speculation of where will they be eventually. Of course I said the same thing about Google when it IPOed, and now it's a money-making machine. Twitter is a great medium, and Facebook might be a great stock over the next five years, but will it be around in 50 years? I think Coca-Cola will be," said Raich.
.J.C. Penney rose after the retailer reported positive monthly same-store sales.
Stock futures had jumped after the European Central Bank surprised traders by cutting its key interest rate to 0.25 percent in a bid to fend off the potential danger of deflation.
"The surprise cut was just that, a surprise. There were a couple of whispers that it might happen before year end, but I don't think anybody had it on their wish list today," said Chip Cobb, portfolio manager at BMT Management, of the unexpected ECB move.