Stocks fell Thursday, weighed down by a hotter-than-expected U.S. inflation report, as tech shares failed to keep the momentum seen earlier in the week.

The tech-heavy Nasdaq Composite slid 0.6%, dipping back below 20,000. The broad market S&P 500 shed about 0.5%, and the Dow Jones Industrial Average also ticked lower by 234 points, or about 0.5%.

Tech shares led the decline, with Nvidia losing more than 1%. Software giant Adobe declined more than 13% following the company's weaker-than-expected 2025 outlook. Meta Platforms, Alphabet and Amazon were slightly lower as well.

The producer price index, which tracks wholesale prices, increased 0.4% last month. Economists polled by Dow Jones expected a 0.2% increase on a monthly basis. The 10-year Treasury yield jumped to the highest level in two weeks following the data.

This follows November's consumer price index report, which came in line with economists' estimates and has prompted investors to anticipate another interest rate cut from the Federal Reserve at its policy meeting next week.

"I think the trajectory of disinflation is promising and concerning at the same time," Keith Buchanan, senior portfolio manager at Globalt Investments, said to CNBC. "We continue to grind below 3%, but progress seems to be slowing as we try to get things towards the Fed's target of 2%."

To be sure, Buchanan still believes the Fed is going to lower rates next week. Fed funds futures trading data reflects a nearly 95% likelihood that central bank policymakers will do so by a quarter point, according to the CME FedWatch tool.

"If they had an idea of a plan that didn't match what the market expected this close to the meeting, we'd know it," he added.

Wall Street is coming off a mixed session, with the Nasdaq topping 20,000 for the first time and reaching new all-time and closing highs. The S&P 500 also gained. The Dow, however, pulled back slightly, marking its fifth consecutive session in the red.