U.S. stocks rebounded from a sharp morning selloff, but still closed lower Thursday, with the Nasdaq snapping a seven-day winning streak as investors paused before the start of earnings season and a lack of policy detail in President-elect Donald Trump’s first formal news conference a day ago.

Equity markets have been trading mostly sideways as investors begin to question the run-up in stock prices following the election on Trump’s promises of fiscal stimulus.

The Nasdaq Composite Index COMP, -1.26% , which had been down by as many as 67 points earlier, finished down 16.16 points, or 0.3%, at 5,547.49, retreating from its record close set on Wednesday, and snapping a streak of seven sessions of gains. Biotech rebounded from earlier losses after Trump said drug companies were “getting away with murder” at his Wednesday news conference. On Thursday, the iShares Nasdaq Biotechnology ETF IBB, -0.38% finished up 0.4%.

The Dow Jones Industrial Average DJIA, -0.46% closed down 63.28 points, or 0.3%, at 19,891.00, after trading down by as many as 184 points earlier in the session. The declines were broad-based, with 22 of the 30 components trading lower. Walt Disney Co. DIS, -1.41% and J.P. Morgan Chase & Co. JPM, -1.14% , which reports earnings Friday morning, led the losses.

The S&P 500 index SPX, -0.84% fell 4.88 points, or 0.2%, to finish at 2,270.44 with seven out of 11 main sectors trading lower. Financials and energy led the declines. Earlier, the index had been down by as many as 21 points.

“The Trump rally has exhausted itself, and it’s natural to see a pullback after a strong advance,” said Joe Saluzzi, partner, co-head of Equity Trading at Themis Trading. “Investors are probably repositioning and getting ready to hear from companies as earnings season begins.”

Saluzzi said investors completely shifted their focus to the prospects of fiscal stimulus, after being dependent on the Fed since the financial crisis.

“For the past seven years it was all about the Federal Reserve and monetary policy. Investors could count on the Fed to come to the rescue any time stocks fell. Now, it seems like nobody is even paying attention to Fed officials when they speak,” said Saluzzi.

Read:What pharma investors ought to do after Donald Trump fires a salvo

Thursday’s pullback in equities also come as St. Louis Fed President James Bullard said fiscal proposals discussed by Trump aren’t likely to take hold until 2018 or 2019. He also said the U.S. economic environment remains one in which low interest rates are prevalent.

Smells like future mobility at the Detroit auto show

Other markets:10-year Treasury yields TMUBMUSD10Y, 0.696% fell 2 basis points to 2.36%. The dollar also retreated, with the ICE dollar index DXY, -0.34% down 0.4% at 101.37, its lowest level in nearly a month.

Oil CLG27, settled up 1.5% at $53.01 a barrel, while gold futures US:GCG7 settled up 0.3% at $1.199.80 an ounce, aided by the U.S. dollar’s slump.

European stocks SXXP, -0.50% traded lower, and Asian markets mostly lost ground.

Economic news and Fed speakers: The market’s reaction to weekly jobless claims and import prices ahead of the opening bell was subdued. Both data releases pointed to continued improvement in the labor market and an uptick in inflation due to higher oil prices.

Philadelphia Fed President Patrick Harker, speaking in Malvern, Pa., said the U.S. economy is “starting 2017 off on a good foot” and three interest rate increases will be appropriate as long as the economy stays on track.

Atlanta Fed President Dennis Lockhart reportedly backed two rate increases for the year during a panel discussion in Naples, Fla.

St. Louis Fed President James Bullard said the Fed may be in a better position to reduce the size of its balance sheet after two rate increases in the past year in a speech to the Forecasters Club of New York. Fed chief Janet Yellen has a town-hall meeting with teachers in Washington, D.C., at 7 p.m. Eastern.

Check out:MarketWatch’s Economic Calendar

Individual movers: Shares in Delta Air Lines Inc. DAL, -1.76% finished down 1.1% after the carrier posted quarterly earnings that matched forecasts and revenue that beat expectations.

Applied Optoelectronics Inc. AAOI, -0.09% stock soared 31% after the maker of optical network equipment forecast earnings well above its original outlook.

Boeing Co. BA, +0.04% fell 0.7% after reports that India’s SpiceJet is expected to purchase about 90 jets from the company for a total of $10 billion, according to a Reuters report.

Shares of AmerisourceBergen Corp. ABC, +0.02% rose 2.9% after Bank of America upgraded the stock to a buy.

Eli Lilly & Co. LLY, +1.00% shares advanced 2.5% after the drug maker said an appeals court upheld a patent infringement ruling in its favor.

Cincinnati Financial Corp. CINF, +0.31% shares were the worst performers on the S&P 500, falling 6.7%, after the insurance reported significant catastrophe losses.

—Mark DeCambre and Victor Reklaitis contributed to this article