NEW YORK (AFP) - US stocks tumbled on Thursday, with large banks falling especially hard as the market girds for a tough first-quarter earnings season.

The Dow Jones Industrial Average fell 174.09 points (0.98 per cent) to 17,541.96.

The broad-based S&P 500 shed 24.75 (1.2 per cent) to 2,041.91, while the tech-rich Nasdaq Composite Index dropped 72.35 (1.47 per cent) to 4,848.37.

Citigroup fell 3.8 per cent, Goldman Sachs 3.1 per cent and JPMorgan Chase 2.5 per cent.

European Central Bank meeting minutes showed support for negative rates, raising worries about a policy that dents bank earnings.

Investment banks also stand to lose huge advisory payoffs from the demise of the US$160 billion (S$216 billion) Pfizer-Allergan merger and potential killing of the Halliburton-Baker Hughes merger.

"It has weakened in all their business lines," said Mace Blicksilver, director of Marblehead Asset Management.

Falling expectations for first-quarter earnings are also hitting sentiment. Analysts now expect earnings for the S&P 500 to be down about 8 per cent in the first quarter, an even deeper drop than the 4 per cent decline projected last week, according to S&P Capital IQ.

Valeant Pharmaceuticals International advanced 3.9 per cent after receiving lender approval to delay its annual and quarterly reports, approvals that were necessary to avoid a potential debt default.

Costco Wholesale fell 3 per cent after reporting that March comparable sales rose just 1 per cent compared with the year-ago period.

L Brands fell 2.3 per cent as it announced it will restructure its Victoria's Secret chain, cutting about 200 jobs.

Used-car chain CarMax sank 7.2 per cent after reporting that fourth-quarter earnings dropped 1.5 per cent to US$141 million.

Petroleum-linked shares retreated as oil prices fell. Dow member ExxonMobil, Apache and ConocoPhillips all lost about 1.1 per cent.