(Updates to late afternoon)

*

Wall Street indexes down, led by decline in Nasdaq

*

Traders cautious after recent equities run up

*

Bitcoin down more than 6%

By Caroline Valetkevitch

NEW YORK, Nov 4 (Reuters) - Major stock indexes dropped

on Tuesday, with chip stocks lower as the CEOs of Goldman Sachs ( GS )

and Morgan Stanley ( MS ) cautioned that equities could

be heading for a pullback, while the dollar climbed to a

four-month high against the euro.

U.S. Treasury yields dipped on risk-off sentiment, which

also helped to support the dollar.

Cryptocurrency bitcoin was down 6.45%, slipping below

$100,000 for the first time since June.

The bank CEOs warned at an investment summit in Hong Kong

of the prospect of a stock market correction of more than 10%

over the next two years.

Shares of Nvidia ( NVDA ) were down 4%, while an index of

semiconductors also fell 4%.

Shares of Palantir Technologies ( PLTR ) dropped more than

8% despite the data analytics provider reporting strong

quarterly results. The company, which has more than doubled in

value this year, forecast fourth-quarter results above market

expectations as the rapid adoption of artificial intelligence is

boosting demand for its services.

"Big Short" investor Michael Burry, known for his successful

bets against the U.S. housing market in 2008, has placed bearish

bets on Nvidia ( NVDA ) and Palantir ( PLTR ), according to a regulatory filing on

Monday.

The S&P 500 fell more than 1% and the Nasdaq dropped more

than 2%. The Nasdaq is still up about 21% for the year so far.

"The market's been moving higher as warranted from an

earnings standpoint, but at some point ... it seemed like it was

kind of positioning for a risk-off pullback even on the

slightest disappointment," said Keith Buchanan, senior portfolio

manager at Globalt Investments.

The Dow Jones Industrial Average fell 251.44 points,

or 0.53%, to 47,085.24, the S&P 500 fell 80.42 points, or

1.17%, to 6,771.55 and the Nasdaq Composite fell 486.09

points, or 2.04%, to 23,348.64.

MSCI's gauge of stocks across the globe fell

11.51 points, or 1.14%, to 996.34.

The pan-European STOXX 600 index fell 0.3%.

Optimism about AI deals has been helping stocks. On Monday,

stocks gained following Amazon.com's ( AMZN ) $38 billion cloud

services deal with ChatGPT creator OpenAI.

The U.S. dollar was underpinned in part by reduced bets for

near-term Federal Reserve easing, with divisions within the Fed

raising doubt about the prospect of another rate cut this year.

The Fed lowered rates last week but Chair Jerome Powell said a

December rate cut was not a foregone conclusion. Traders are

betting on a 65% chance of a rate cut in December, compared with

94% a week earlier, CME FedWatch showed.

The euro fell for the fifth straight session and was down

0.3% at $1.148, its weakest since August 1. Against the yen, the

dollar was 0.5% lower, though the Japanese currency remained

near a recent 8-1/2-month low.

Sterling tumbled after the UK finance minister pointed to

"hard choices" in her upcoming budget. Sterling weakened

0.72% to $1.3044.

U.S. Treasury yields declined amid a broader risk-off tone in

financial markets.

Because of the government shutdown, a closely watched

monthly jobs report from the Bureau of Labor Statistics will not

be available on Friday, as previously scheduled.

The yield on benchmark U.S. 10-year notes fell 2

basis points to 4.087%, from 4.107% late on Monday.

U.S. crude fell 49 cents to settle at $60.56 a

barrel and Brent fell 45 cents to settle at $64.44. A

stronger dollar weighed.

Spot gold fell 1.69% to $3,933.67 an ounce.

(Additional reporting by Reporting by Twesha Dikshit, Purvi

Agarwal and Johann M Cherian in Bengaluru and Lucy Raitano in

London and by Kevin Buckland in Tokyo; Editing by Sam Holmes,

Mark Potter, Sharon Singleton and Richard Chang)