Government data released yesterday indicated slowly rising prices for consumers, as well as a surprising plunge in jobless claims to an 11-month low, and a ramp-up in housing construction.

The reports pointed to an economy that is more resilient than the market had thought, leading more investors to lower their expectations for a rate cut. A cut could boost consumer spending by making debt less cumbersome and could help companies pull in higher profits.

"People have been focusing so much on the weak housing market, but it doesn't look like it's spilling at all into the rest of the economy. This expansion is going to go on," said Brian Gendreau, investment strategist for ING Investment Management. "The market has been pricing in a rate cut. It's still in there, but with a lot less conviction than before."

Meanwhile, Apple issued a forecast for the current quarter that was strong, but not as strong as investors anticipated. The report, which overshadowed record profit from brokerage Merrill Lynch & Co. Inc., compelled investors to scale back their high expectations for computer and electronics sales this year. Apple shares fell $5.88, or 6.2 percent, to $89.07 on the Nasdaq.

Crude oil's drop to $50 a barrel yesterday also made investors shudder. Though low energy prices help consumers, the plunge could mean big losses for companies that have money in commodities as part of their investment strategy.

The technology-laden Nasdaq composite index declined 36.21, or 1.46 percent, to 2,443.21 - its biggest one-day drop since Nov. 27, when it fell 2.21 percent. The Nasdaq, however, is still up more than 1 percent on the year.

The Dow Jones industrial average slipped 9.22, or 0.07 percent, to 12,567.93.

The Standard & Poor's 500 index fell 4.25, or 0.30 percent, to 1,426.37.

Bonds fell slightly, with the yield on the benchmark 10-year Treasury note at 4.77 percent, down from 4.78 percent late Wednesday. The dollar was mixed against other major currencies, while gold prices edged lower.

Crude sank $1.76 to settle at $50.48 a barrel on the New York Mercantile Exchange. It briefly fell below $50 to its lowest price in 20 months after the U.S. Department of Energy reported that the nation's inventories of crude oil and gasoline grew.

Plummeting energy prices are expected to be generally supportive to stocks, as lower fuel costs leave consumers with more money to spend. However, they are taking a toll on some energy-related stocks: Exxon Mobil Corp. fell 50 cents, to $71.96, while ConocoPhillips fell 94 cents, to $62.61.

The drop in oil also takes away some of the feel of a boom time from financial markets - when crude peaked at $78 last summer, it helped draw new investment money. Now, the fear on Wall Street is that the pullback will have the opposite effect, sending some investors to the sidelines.