Financial and tech shares showed particular weakness, while large drug stocks posted gains as investors sought safety in consumer staples, energy and healthcare, which usually do well when rates are rising. The market's muted reaction to earnings news did not surprise analysts, who said share prices already reflect most of the gains that were expected for the first quarter.

"The markets were too enthusiastic, too far ahead of earnings, and they had not factored in other influences — a close election, geopolitics, interest rate changes — and the result is this volatility," said Subodh Kumar, chief investment strategist for CIBC World Markets.

Rate-sensitive financial stocks sank. Citigroup lost $1.03 to $49.92, despite soundly beating analysts' estimates and saying it expects continued growth.

Apple soared $2.66, or 10 percent, to $29.30 as huge demand for its iPod portable digital music players helped it easily beat Wall Street expectations.

Advancing and declining shares were about even on the New York Stock Exchange.

Consolidated volume came to 1.94 billion shares, compared with 1.91 billion shares traded on Wednesday.

Buyers were scarce yesterday in the bond market, where the yield on the 10-year Treasury note rose to 4.40 percent, from 4.37 percent Wednesday. The selling was not dramatic, compared to recent weeks, but bond prices were still "moving in the wrong direction," said Brian Pears, head equity trader at Victory Capital Management in Cleveland.