Wall St ends lower as bank CEOs warn of possible pullback, fueling tech bubble jitters

• Indexes down: Dow 0.53%, S&P 500 1.17%, Nasdaq 2.04%
• Palantir slides despite estimate-topping Q4 revenue forecast
• Uber slides as Q4 adjusted core profit misses estimates

By Stephen Culp

NEW YORK, Nov 4 (Reuters) - U.S. stocks closed sharply lower on Tuesday as big banks warned that equity markets could be headed for a drawdown, reflecting mounting concerns over stretched valuations.

All three major U.S. stock indexes slid well into negative territory after the CEOs of Morgan Stanley MS.N and Goldman Sachs GS.N stoked fears of a potential market bubble, with the S&P 500 having climbed to a series of all-time highs, largely powered by the artificial intelligence boom.

The S&P 500 and the Nasdaq suffered their biggest one-day percentage drop since October 10.

Tech shares .SPLRCT weighed particularly heavily on the Nasdaq, with six of the "Magnificent Seven" AI-related momentum stocks losing ground on the day.

The Philadelphia SE Semiconductor index .SOX dipped 4.0%.

JPMorgan Chase JPM.N CEO Jamie Dimon warned last month of the heightened risk of a significant stock market correction within the next six months to two years, citing factors including geopolitical tensions.

"Investors seem a little more worried about valuation than they have in a while, at least today," said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana.

"A lot of these companies' valuations were pretty stretched and their earnings were good, but not great," Carlson added. "And that's a recipe for profit-taking."

The U.S. government shutdown, the result of a congressional impasse, is nearing the record for the longest ever. The resulting dearth of official government data has led to increased scrutiny of private sources such as ADP's National Employment Report expected Wednesday.

Comments from Federal Reserve officials are being parsed for clues as to how the data-dependent central bank will forge its monetary policy in the absence of crucial economic indicators.

Local elections for New York's mayor and governors in New Jersey and Virginia will also be closely tracked.

The Dow Jones Industrial Average .DJI fell 251.44 points, or 0.53%, to 47,085.24, the S&P 500 .SPX lost 80.42 points, or 1.17%, to 6,771.55 and the Nasdaq Composite .IXIC lost 486.09 points, or 2.04%, to 23,348.64.

Tech was down the most among the 11 major sectors comprising the S&P 500, falling 2.3%. Financials .SPSY led the gainers.

Palantir Technologies PLTR.O slid 8.0% despite the data analytics company's better-than-expected fourth-quarter revenue forecast. The stock has soared over 152% so far this year.

Uber UBER.N fell 5.1% in the wake of the ride-hailing platform's quarterly profit miss, while Henry Schein HSIC.O advanced 10.8% after hiking its annual profit forecast.

Spotify SPOT.N and U.S.-listed shares of Shopify SHOP.O dipped 2.3% and 6.9%, respectively, after their quarterly results.

Declining issues outnumbered advancers by a 2.45-to-1 ratio on the NYSE, where there were 68 new highs and 178 new lows.

On the Nasdaq, 1,134 stocks rose and 3,578 fell as declining issues outnumbered advancers by a 3.16-to-1 ratio.

The S&P 500 posted 13 new 52-week highs and 19 new lows while the Nasdaq Composite recorded 54 new highs and 260 new lows.

Volume on U.S. exchanges was 19.82 billion shares, compared with the 21.04 billion average for the full session over the last 20 trading days.

S&P 500 forward PE