US benchmark equity indexes closed lower Thursday despite a post-earnings surge in Nvidia (NVDA) shares, as markets analyzed the latest macro data.

The Dow Jones Industrial Average dropped 1.5% to 39,065.3, while the S&P 500 lost 0.7% to 5,267.8. The Nasdaq Composite retreated 0.4% to 16,736. Among sectors, real estate and utilities saw the steepest declines. Technology was the sole gainer.

In company news, Nvidia shares jumped 9.3%, the best performer on the S&P 500 and the Nasdaq. The chipmaker's fiscal first-quarter results surpassed Wall Street's estimates late Wednesday as demand for generative artificial intelligence drove record data-center revenue. The company announced a forward stock split.

International Paper (IP) was the second-top gainer on the S&P 500, up 6.1%, as Jefferies upgraded the stock to buy from hold and adjusted its price target to $57 from $38.

Live Nation Entertainment (LYV) saw the steepest decline on the S&P 500, down 7.8%, after the US Department of Justice and 30 state and district attorneys general sued the live entertainment company and its Ticketmaster unit for alleged market monopolization and anticompetitive practices.

The US two-year yield gained 5.7 basis points to 4.94%, while the 10-year rate rose 4.5 basis points to 4.48%.

In economic news, new-home sales in the US retreated last month amid elevated mortgage rates, while median prices at the national level eased sequentially, government data showed.

The latest report surprised to the downside, while a downward revision to March data indicated that sales are entering the second quarter with "weaker momentum than previously thought," Oxford Economics said in a note.

Manufacturing and services activity in the US private sector unexpectedly climbed in May as output growth "accelerated sharply," though inflationary pressures persisted, S&P Global (SPGI) said.

Manufacturing activity in the US Midwest region improved into shallower contraction territory in May as shipments swung positive while orders declined, the Federal Reserve Bank of Kansas City said.

Weekly applications for unemployment insurance in the US declined more than Wall Street's expectations, according to government data that reflect a robust labor market in the world's largest economy.

West Texas Intermediate crude oil fell 0.9% to $76.87 per barrel Thursday.

Members of the Fed's monetary policy committee indicated earlier this month that the disinflation process was expected to take longer than previously projected, minutes from the committee's April 30-May 1 meeting showed Wednesday.

"According to the minutes, several participants questioned whether the neutral rate has increased, suggesting the current level of policy may be less restrictive than previously thought," Stifel said in a Thursday note. "With inflation and the economy failing to evolve as expected, at least some Fed officials noted concerns around the current terminal rate, potentially questioning whether the committee has done enough to tame price pressures."

Gold tumbled 2.5% to $2,333.10 per troy ounce, while silver declined 3.8% to $30.30 per ounce.