US stocks declined modestly on Wednesday as investors digested a new round of corporate earnings and looked ahead to key economic data later in the week.
The Dow Jones Industrial Average fell 92 points, or 0.2%, after hitting a record high in the previous session.
The S&P 500 slipped 0.1%, and the Nasdaq Composite lost 0.4%.
Netflix shares dropped 8% after the streaming giant missed earnings expectations, while Intuitive Surgical surged 15% following stronger-than-expected quarterly results.
The Dow’s record-setting session on Tuesday briefly pushed the index above 47,000, supported by solid earnings from Coca-Cola and 3M.
However, the broader market lagged after President Donald Trump commented that his planned meeting with Chinese President Xi Jinping “maybe won’t happen,” tempering optimism about potential trade progress between the two nations.
Despite the pullback, investors remain optimistic that strong corporate earnings could sustain the equity rally.
Tesla is scheduled to report results after the bell on Wednesday, marking the first of the “Magnificent Seven” tech heavyweights to release earnings this season.
According to FactSet, over three-quarters of S&P 500 companies that have reported so far have exceeded analyst expectations.
CPI Data and Fed policy in focus
Traders are also awaiting the September consumer price index (CPI) report, due Friday, which will offer fresh insight into inflation trends.
The data is particularly significant as other government releases remain suspended due to the ongoing US government shutdown.
The inflation report will play a key role in shaping expectations for the Federal Reserve’s next policy move.
Markets widely anticipate a 25 basis point reduction in the central bank’s overnight borrowing rate at its late-October meeting, followed by another cut in December.
Meme stocks are on fire
Beyond Meat and Krispy Kreme were among the most active stocks in early trading, extending the week’s volatile rally in meme-related names.
Beyond Meat surged another 48% after soaring 140% on Tuesday — its largest single-day gain ever — following news of a distribution deal with Walmart.
The stock’s surge was further fueled by its addition to Roundhill Investments’ Meme Stock ETF (MEME).
Krispy Kreme jumped 18% in early trading after rising 14% on Tuesday, buoyed by the same speculative momentum driving Beyond Meat and other retail favourites.
Intuitive Surgical also extended gains in early trading after reporting adjusted third-quarter earnings of $2.40 per share on revenue of $2.51 billion, topping analyst estimates of $1.98 per share and $2.4 billion, respectively, according to LSEG data.
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