Investors who drove US blue-chip stocks to record highs this week paused to take profits yesterday, knocking the Dow Jones industrial average down more than 120 points. Technology stocks continued their winning streak, outperforming the rest of the market.

At the close of trading, the Dow was down 127.59 points, or by 1.1 per cent, at 11,198.45. Broader stock indicators were also lower. The Standard and Poor's 500 fell 19.78 to 1,362.01, and the Nasdaq composite index fell 31.49 to 2,774.11. Declining issues outnumbered advancers by a three-to-two margin on the New York Stock Exchange, with 1,788 down, 1,188 up and 553 unchanged. NYSE volume totalled 709.16 million shares, against 840.86 million in the previous session.

Traders said investors were selling stocks to lock in profits after the Dow reached a new record close of 11,326.04 on Wednesday, pushed higher by the Federal Reserve's decision to raise interest rates.