01:47 PM EST, 11/13/2025 (MT Newswires) -- US equity indexes fell in midday trading Thursday as concern that core inflation rate is increasing sent government bond yields higher and the odds for a December interest-rate cut sharply lower, piling more pressure on big tech.

The technology-heavy Nasdaq slumped 2.4% to 22,837.1, leading the pack given the detrimental impact of higher-for-longer interest rates on long-duration assets. The S&P 500, whose exposure to high-growth areas is relatively smaller compared with the Nasdaq, dropped 1.5% to 6,743.8. The Dow Jones Industrial Average, home to old economy stocks, slid 1.3% to 47,633.7.

According to the Federal Reserve Bank of Cleveland's inflation nowcast, the core consumer price index, which excludes the more volatile food and energy prices, is forecast to have grown by an estimated 0.3% in October.

In September, according to the US Bureau of Labor Statistics, the core CPI rose by 0.2%. October's CPI data from the BLS, scheduled for release on Thursday, is delayed, according to media reports.

San Francisco Fed President Mary Daly said Thursday it's "premature" to say whether or not the Federal Open Market committee members should cut rates for a third consecutive time at the December policy meeting, according to a note from Stifel. Noting the tension between the fed's twin goals, Daly said inflation is "still stubborn" while the labor market has "slowed quite a bit."

Atlanta Fed President Raphael Bostic said Wednesday that the "clearer and urgent risk is still price stability" despite shifts in the labor market, according to the Stifel note.

Echoing Bostic, Boston Fed President Susan Collins said that while October's interest rate reduction was "prudent" to support a cooling labor market, she is in favor of holding rates steady "for some time to balance the inflation and employment risks in a highly uncertain environment," as per the Stifel note.

Meanwhile, the probability of a 25-basis-point reduction in interest rates in December dropped to about 48% by Thursday afternoon, down from 63% the previous day, according to the CME Group's FedWatch Tool. The likelihood of the target rate for fed funds being left unchanged in the 3.75% to 4% range jumped to 52% from 37% on the previous day.

US Treasury yields rose across the curve, with the 10-year yield up 3.2 basis points to 4.11% and the two-year rate also higher by 2.5 basis points to 3.59%.

The CBOE Volatility Index (VIX), also known as a fear gauge for the S&P 500, surged 13.2% to 19.82.

Energy, healthcare, and consumer staples were the only sectors to be trading up intraday, reflecting the continuation of a potential rotation out of technology, communication services, and consumer discretionary, which led the decliners in midday trading on Thursday. Valuation has been a chief concern for investors to lighten exposure to over-extended areas of the market.

Among the five Magnificent-7 stocks that fell intraday, the worst performer was Tesla (TSLA), down 7.8%, among the worst performers on the S&P 500 and the Nasdaq.

The Global X Artificial Intelligence & Technology ETF ( AIQ ) , with net assets of $5.98 billion and investments in firms related to AI, slumped 3.2%. The $386 billion Invesco QQQ Trust (QQQ), a tech-heavy exchange-traded fund offering exposure to Magnificent-7 across technology and communication services sectors, dropped 2.3%.