The S&P 500 has ended a volatile session close to unchanged, with financials among sectors lending support a day after the market sold off on a hawkish slant in Federal Reserve minutes.
The S&P 500 financials index rose, extending recent strong gains. Other economically sensitive sectors including energy were up as well.
Banks were among the top performers among financials, with the S&P 500 bank index gaining as the benchmark US 10-year Treasury yield touched its highest level since April 2021.
Higher interest rates can increase profit margins for banks and other financial firms.
Shares of Meta Platforms jumped and gave the biggest boost to the S&P 500 and Nasdaq.
But the Dow was lower and the heavily weighted S&P technology index also eased, after being the biggest drag on the S&P 500 on Wednesday when minutes from the Fed's December meeting signalled the possibility of sooner-than-expected rate hikes.
Investors will now watch for Friday's monthly jobs report from the US Labor Department.
"We have a jobs report tomorrow, which continues to be a focal area for the market in terms of the progression of the labor market," Bill Northey, senior investment director at US Bank Wealth Management, said.
Wednesday's private payrolls report was stronger than expected, and the Fed minutes cited a "very tight" job market and unabated inflation.
According to preliminary data, the S&P 500 lost 3.77 points, or 0.09 per cent, to end at 4,696.25 points, while the Nasdaq Composite lost 15.54 points, or 0.12 per cent, to 15,084.64. The Dow Jones Industrial Average fell 170.72 points, or 0.47 per cent, to 36,236.39.
So far this week, market participants have rotated out of technology-heavy growth shares and into more value-oriented stocks that tend to do better in a high interest-rate environment.
Data early on Thursday showed the number of Americans filing new claims for unemployment benefits rose last week.
Separately, US services industry activity slowed more than expected in December, but supply bottlenecks appeared to be easing.