U.S. stocks slipped modestly on Wednesday as weaker-than-expected earnings from streaming giant Netflix weighed on sentiment, while investors awaited key quarterly results from Tesla and other major tech firms.
At 09:45 ET (13:45 GMT), the Dow Jones Industrial Average fell 43 points (0.1%), the S&P 500 slipped 2 points (0.1%), and the NASDAQ Composite dipped 18 points (0.1%). Despite the decline, more than 75% of S&P 500 companies that have reported earnings so far have beaten forecasts, according to FactSet, underscoring continued resilience in corporate America.
Netflix’s shares slumped after the company reported an operating margin of 28%, missing expectations due to tax-related charges in Brazil. Still, quarterly revenue and profit increased, supported by record ad sales, growing memberships, and higher subscription prices.
“Netflix’s core fundamentals remain strong, but investors wanted perfection after the stock’s strong run,” said analysts at ING.
Toymaker Mattel also disappointed with weaker U.S. sales, while AT&T exceeded expectations by adding more wireless customers than forecast, boosted by promotional iPhone offers.
Tesla Results and Corporate Movers
All eyes are now on Tesla (NASDAQ: TSLA), which is set to report earnings after market close. The electric vehicle maker had earlier announced record Q3 deliveries, aided by discounts ahead of the phaseout of a $7,500 EV tax credit. Markets will watch for signs of margin pressure as incentives taper off.
Other major corporate movers included:
- GE Vernova (NYSE: GEV): Stock slipped after missing earnings estimates despite strong order growth.
- Hilton Worldwide (NYSE: HLT): Gained after beating profit forecasts, though it cut its 2025 revenue outlook on softer travel demand.
- Apple (NASDAQ: AAPL): Declined after reports that it’s cutting iPhone Air production to prioritize new iPhone 17 variants.
Overall, investors remain cautious amid mixed signals from corporate America, awaiting fresh inflation data later in the week to assess the likelihood of a Federal Reserve rate cut.
Geopolitics and Commodities Diverge
Geopolitical tensions also pressured sentiment. Hopes for a Trump–Xi meeting in South Korea have dimmed, while a planned Trump–Putin summit was shelved after Moscow refused to discuss ending its ongoing war in Ukraine.
Meanwhile, commodities diverged:
- Gold extended losses, down 0.6% at $4,085.71/oz, following a sharp sell-off in Asia.
- Oil surged as Brent rose 2.2% to $62.67/barrel and WTI gained 2.4% to $58.63, boosted by plans to refill the U.S. Strategic Petroleum Reserve and drawdowns in U.S. inventories.
With the U.S. government shutdown delaying economic data releases, investors face an increasingly uncertain macro backdrop heading into Friday’s CPI report — a key indicator that could cement expectations of monetary easing next month.
