(Updates to midday)

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Wall Street indexes down, led by 1% decline in Nasdaq

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Traders cautious after recent equities run up

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Divergent views at Fed cloud outlook for December rate cut

By Caroline Valetkevitch

NEW YORK, Nov 4 (Reuters) -

Major stock indexes declined on Tuesday, with chip stocks

lower as chief executives at 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.

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 more than 2% early,

while an index of semiconductors also was down about 2%.

Shares of Palantir Technologies ( PLTR ) were down more than

7% despite the company reporting strong quarterly results. The

company, which has more than doubled in value this year,

forecast fourth-quarter results

above market expectations, driven by a rapid AI adoption

boosting demand for its data analytics services.

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

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

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

filing on Monday.

The Nasdaq was down more than 1%, leading declines among the

three major U.S. stock indexes. The Nasdaq is still up nearly

22% 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 190.95 points,

or 0.40%, to 47,147.49, the S&P 500 fell 54.48 points, or

0.80%, to 6,797.49 and the Nasdaq Composite fell 316.86

points, or 1.33%, to 23,517.86.

MSCI's gauge of stocks across the globe fell

8.53 points, or 0.84%, to 999.38.

The pan-European STOXX 600 index fell 0.42%.

Earlier, Asian shares tumbled from all-time highs.

Stocks gained Monday following Amazon'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 now

price 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 a

nd 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.

Cryptocurrency bitcoin was down 2% to $107,486, its

weakest since June.

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

2.6 basis points to 4.081%, from 4.107% late on Monday.

U.S. crude fell 0.64% to $60.66 a barrel and Brent

fell to $64.50 per barrel, down 0.6% on the day. Spot

gold fell 0.67% to $3,975.00 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 and Sharon Singleton)