U.S. stocks declined and oil prices reversed early gains, as cease-fire talks between Russia and Ukraine yielded little progress and inflation readings reached a 40-year high.

The $Nasdaq Composite Index(.IXIC.US)$ fell 125.58 points, or almost 1%, to close Thursday at 13129.96. The $S&P 500 index(.SPX.US)$ shed 18.36 points, or about 0.4%, to 4259.52. The $Dow Jones Industrial Average(.DJI.US)$ declined 112.18 points, or 0.3%, to 33174.07.

All three indexes closed above their session lows but finished down for the third time this week after breaking a four-session losing streak Wednesday. Oil prices were down after rising in early trading.

Investors are worried about the global economic outlook, sapping their appetites for riskier assets in recent days. The S&P 500 and Dow industrials remain in correction territory, while the Nasdaq is in a bear market.

The yield on the benchmark 10-year Treasury, meanwhile, increased to 2.008% from 1.946% Wednesday, logging a fourth consecutive daily gain.

"Investors are yo-yo-ing between hope and fear linked to a potential cease-fire or some kind of positive outcome" in Ukraine, said Mike Mussio, president of FBB Capital Partners. A Thursday meeting between Russian and Ukrainian officials in Turkey didn't yield a cease-fire agreement or a deal to protect civilians caught up in the fighting.

U.S. inflation reached a new four-decade high in February, with the consumer price index up 7.9% from a year earlier. Gas prices are at record levels, hurting consumers' budgets. Analysts are warning that the U.S. and Europe could see sustained inflation and lower economic growth -- also known as stagflation -- with elevated energy prices eating away at household spending on other items.

Federal Reserve Chairman Jerome Powell said last week that he plans to propose a  quarter-percentage-point rate increase at the central bank's meeting next week in an effort to control inflation.

The Fed faces an enormously difficult challenge, and it's going to have to really walk a tightrope between inflation and pushing us into recession." 

-said Ed Keon, chief investment strategist at PGIM Quantitative Solutions.

On Thursday, futures for Brent crude, the global oil benchmark, traded down 1.6% at $109.33 a barrel. The U.S. equivalent, West Texas Intermediate, was down 2.5% to $106.02. Oil prices fell from recent highs on Wednesday but remained above $100 a barrel.

"Oil prices have been like a rocket ship," said Jason Pride, chief investment officer of private wealth at Glenmede. "There's a high likelihood that with the magnitude of the move, there could be some backing off in that trade."

The S&P's energy sector rose more than 3% despite declines in oil prices. Most sectors, however, fell Thursday, led by a 1.8% drop in information technology.

In individual stocks,  $Amazon(AMZN.US)$ shares closed up $150.77, or 5.4%, to $2,936.35 after the e-commerce giant's board approved a  20-for-1 stock split and authorized the repurchase of as much as $10 billion of common stock. Shares of $Peloton Interactive(PTON.US)$ lost 83 cents, or 3.5%, falling to $22.61 after the company said it would overhaul its pricing strategy. Shares of Chinese retailer $JD.com(JD.US)$ dropped $9.88, or almost 16%, to $52.52  after reporting slower revenue growth.

Overseas, the pan-continental Stoxx Europe 600 fell 1.7%, after notching its largest daily percentage gain since March 2020 on Wednesday. The index's banking sector fell 2.6% Thursday, as investors worried about the European economy's exposure to Russia.

The European Central Bank kept its key policy rate unchanged but indicated that it may end its asset-purchase program in the third quarter, sooner than expected. Investors expect that an end to that program could open the door to an interest-rate increase. The euro rose 0.2% against the dollar after the announcement.

Russia's invasion of Ukraine has injected volatility into stocks, bonds, commodities, and currencies, as investors try to assess the impact of sanctions and the potential for disruptions to trade and supply chains.

The Russian ruble traded at more than 133 rubles to the dollar Thursday, having strengthened against the greenback from Wednesday, according to FactSet. Assessing the ruble's value has grown difficult over the past two weeks, as it has become harder for banks to execute orders, following Western sanctions and capital controls imposed by Russia. Russia's stock market has been closed since Feb. 25.

Bitcoin's dollar value dropped 5.5% Thursday from its 5 p.m. ET level Wednesday to $39,591.05. The world's largest cryptocurrency by market value rallied Wednesday as President Biden announced an executive order to study digital currencies.

The London Metal Exchange paused trading in nickel Tuesday. London's nickel market will stay closed until at least next week.

Major benchmark stock indexes in Asia tracked Wall Street's gains from Wednesday. China's Shanghai Composite rose 1.2% Thursday, South Korea's Kospi jumped 2.2% and Japan's Nikkei 225 surged 3.9%.