U.S. stocks fell on Thursday, with all major indexes down more than 1 percent on weakness in the technology and health insurance sectors.

Semiconductor stocks sank after Bank of America-Merrill Lynch cut its 2010 growth outlook for the industry, citing the potential for a correction in inventory levels.

BofA downgraded 10 stocks in the group, including Intel Corp , Texas Instruments Inc and Marvell Technology Corp .

Tech and semis are one of the areas that have led the market, and now they're very over extended, said Alan Lancz, president of Alan B. Lancz & Associates in Toledo, Ohio. Investors are asking if they believe the rally and whether we've moved up too fast.

Dow component Intel fell 5.3 percent to $19.05, while Marvell sank 6.2 percent to $15.08, and Texas Instruments lost 4 percent to $24.75. The Philadelphia Semiconductor index <.SOXX> dropped 4.1 percent.

The Dow Jones industrial average <.DJI> slid 132.64 points, or 1.27 percent, to 10,293.67. The Standard & Poor's 500 Index <.SPX> fell 17.24 points, or 1.55 percent, to 1,092.56. The Nasdaq Composite Index <.IXIC> tumbled 40.83 points, or 1.86 percent, to 2,152.31.

Health insurance stocks fell after U.S. Senate Majority Leader Harry Reid released a long-awaited healthcare reform plan on Wednesday that budget analysts said would extend coverage to tens of millions of the uninsured.

The Morgan Stanley Healthcare Payor index <.HMO> fell 1.5 percent, while Cigna Corp lost 3 percent to $29.89, and WellPoint Inc shed 1 percent to $51.88.

The Conference Board said its index of leading economic indicators climbed a weaker-than-expected 0.3 percent to 103.8 in November.

Also on Thursday, the Philadelphia Federal Reserve Bank said its business activity index rose to a two-year high in November.

The Labor Department said the number of U.S. workers filing for jobless insurance was unchanged at a seasonally adjusted 505,000 in the week ended November 14, as expected.

(Editing by Jeffrey Benkoe)