4:15pm: Mag 7 earnings kick off
US stocks ended lower on Wednesday as investors navigated a busy day of earnings, with the spotlight on Tesla (TSLA) and IBM (IBM).
The Dow Jones dropped 334 points, or 0.7%, to 46,590, while the S&P 500 fell 36 points, or 0.5%, to 6,699. The Nasdaq lost 213 points, or 0.9%, closing at 22,740, and the Russell 2000 slid 36 points, or 1.5%, to 2,452.
Investors digested the first wave of third-quarter results amid a broad unwind of recent momentum trades, with crypto and gold struggling to find footing.
Attention now turns to Tesla, which is set to report after the bell, kicking off a fresh round of "Magnificent Seven" tech earnings that could test the durability of the recent market rally.
3:50pm: Proactive news headlines
- Nevis Brands reported Q3 revenue growth of 16% to C$478,808, driven by licensed market expansion and early success of its hemp-derived THC products.
- Sonoro Gold Corp closed an oversubscribed private placement raising C$4.1 million to fund development of its Cerro Caliche gold project in Mexico.
- NanoViricides said its drug NV-387 increased survival time in mice infected with measles by 130%, showing strong activity in cell culture and humanized animal models.
- Medicus Pharma treated the first patient in its Phase 2 SKNJCT-004 clinical study for non-invasive basal cell carcinoma treatment across six UAE sites.
- Phunware Inc appointed interim CEO Jeremy Krol to the board, with Krol continuing in his CEO role.
- Digi Power X Inc appointed Ajay Gupta, a wealth management executive and family office principal, to its board of directors.
- Argentina Lithium & Energy Corp released its first mineral resource estimate for Rincon West lithium brine project, showing 238,000 tonnes LCE Measured & Indicated and 64,000 tonnes LCE Inferred.
- Charbone Hydrogen Corporation received all major production equipment at its Sorel-Tracy green hydrogen site, marking a key project milestone.
3:15pm: Market movers
- Carvana Co shares tumbled after short seller Jim Chanos flagged “lots of red flags” in the company’s business model and financial disclosures, raising concerns about subprime lending exposure.
- Netflix Inc analysts remained cautiously optimistic following Q3 results, citing margin expansion and advertising growth as signs of strengthening fundamentals despite near-term uncertainty.
- Applied Digital secured a $5 billion, 15-year lease with a US hyperscaler for 200 MW of AI and HPC capacity at its Polaris Forge 2 Campus.
- Beyond Meat Inc shares surged roughly 650% over five trading days in a meme-stock rally, rising from $0.60 to $5.20.
- GE Vernova Q3 revenue grew 12% to $10 billion, beating estimates, but shares dropped as EPS fell short of Wall Street expectations.
- AT&T Inc shares declined nearly 5% after reporting Q3 revenue of $30.7 billion, slightly below analysts’ forecasts.
2:35pm: Tesla's turn
Tesla Inc (NASDAQ:TSLA) is set to reports its third quarter 2025 earnings on Wednesday after US markets close, with Wedbush analysts anticipating a stronger-than-expected quarter driven by EV deliveries and a rebound in China sales.
“After a brutal few quarters we are finally starting to see stable demand trends for Tesla,” the analysts believe.
Wedbush projects third quarter total revenue of roughly $26 billion, including automotive revenue near $19 billion, slightly below the Wall Street consensus of $26.45 billion.
The firm projects earnings per share (EPS) of $0.53, in line with the consensus.
1:35pm: Meme stocks return
Beyond Meat Inc (NASDAQ:BYND) shares have soared roughly 650% in five trading days, rising from $0.60 last Thursday to $5.20 on Wednesday, fueled by retail investor interest on social media and short squeezes.
The plant-based food company is heavily shorted, with 81.8% of free-float shares sold short, up from 64% last week. Investors had bet against Beyond Meat due to financial struggles and a $1 billion debt-for-equity swap that expanded its share count from 76.6 million to over 316 million.
Donut chain Krispy Kreme (NASDAQ:DNUT) also rose nearly 14%, boosted by retail enthusiasm and international expansion plans.
12:40pm: Tech lags
Stocks were trading lower by midday, with the Dow Jones down 0.5% at 46,674. The S&P 500 fell 0.7% to 6,688, while the Nasdaq led the declines, sliding 1.2% to 22,673.
Tech continues to be a mixed bag. Five of the “Magnificent Seven” stocks were in the red: Nvidia and Apple each dropped 1.5%, Amazon lost 1.2%, Meta edged down 0.1% following reports of layoffs in its AI division, and Tesla dipped 1.6% ahead of its earnings report after the bell.
On the flip side, Microsoft and Alphabet bucked the trend, climbing more than 1% each, giving investors at least a little relief in an otherwise soft session.
Investors are weighing mixed tech earnings and economic signals as the market heads into the afternoon.
11:35am: S&P 500 nears peak
The S&P 500 had rebounded to around 6,750 points, near its all-time high, driven by improving macroeconomic conditions and a shift in investor sentiment. Key factors include easing US–China trade tensions, with Linh Tran, Market Analyst at XS.com noting that President Trump’s remarks suggesting 100% tariffs “would not be sustainable” have bolstered optimism.
The Federal Reserve’s steady interest rates and signals that quantitative tightening is “nearing its end” have also supported equities, while a sharp pullback in gold reflects increased risk appetite.
Tran emphasized that the upcoming Q3 earnings season, particularly in tech, consumer, and financial sectors, could sustain the rally.
Despite fiscal headwinds, she concluded that “the fundamental outlook for the S&P 500 in Q4 remains positive, barring any major policy or geopolitical shocks.”
10:40am: Netflix hurting
Netflix shares have lost nearly 9.5% in early Wednesday trading after the streaming giant posted disappointing Q3 earnings.
Netflix reported lower-than-expected net income for the third quarter, weighed down by a one-off tax payout in Brazil, although underlying performance remained solid.
The streaming giant recorded revenues of C$11.51 billion, in line with analyst expectations. However, a $600 million settlement related to a Brazilian tax dispute reduced net income, which would have otherwise exceeded forecasts.
“This dented an otherwise strong set of earnings,” said Kathleen Brooks, analyst at XTB. She added that while the issue was known, the market did not expect it to hit earnings, putting downward pressure on Netflix shares.
Brooks noted that margin growth for 2025 will take a hit from the tax bill, but there should be no other long-term effects.
9.55am: Mixed start
Early trading in New York was mixed on Wednesday, with the S&P 500 and Nasdaq climbing out of an early hole, but the Dow Jones and Russell 2000 remaining in the red.
The Dow Jones was down just over 100 points or 0.2% in initial trades, while the small-cap Russell index was down 0.3%.
After opening underwater, the S&P 500 and Nasdaq Composite managed to clamber just onto flat land, up just a small handful of points and less than 0.1%.
Dragging on the S&P were falls of 7.7% for Netflix, and 7.2% for Texas Instruments, both on quarterly updates that disappointed.
Beyond Meat Inc (NASDAQ:BYND) shares added another 60% after soaring 146% in the previous session when the vegan food maker said its products would be available at more Walmart stores.
The Nasdaq was led higher by 1% gains for Nvidia and Microsoft, while Alphabet was up over 2%.
8.10am: Cautious start predicted for Nasdaq
US stocks are expected to start on the back foot on Wednesday, led by Netflix, after its earnings disappointed overnight.
Nasdaq 100 futures were down 0.3%, with those for the Dow Jones and S&P 500 both down less than 0.1%.
The previous day was mixed, with the Dow adding 0.5% to close at a record high, while the S&P finished less than one point above flat, while the Nasdaq dropped 0.2% and the domestically focused Russell 2000 lost 0.5%.
European markets were mixed in early trading on Wednesday, with London's FTSE up 0.9%, but German and French benchmarks in the red.
Earnings reports and economic data was setting the tone, with inflation numbers and Barclays improving sentiment in London, while L’Oreal dropped 6% on news that US sales were being hit by tariffs.
Investors are also considering the broader geopolitical backdrop, said market analyst David Morrison at Trade Nation, as reports indicated talks between US President Trump and Russian President Putin in Hungary had been postponed, while Trump also cast some doubt over his meeting with China’s President Xi.
"The delay tempered optimism about a potential Ukraine peace framework, contributing to the cautious tone across European markets."
Overnight, Trump said talks with his Chinese counterpart ahead of his 1 November tariff deadline "maybe [...] won’t happen”.
This has created a cloud of uncertainty over expectations in New York.
"But despite these geopolitical shenanigans, investors remain cautiously optimistic overall, taking solace from a strong start to the third quarter earnings season," said Morrison.
Next week is the key for the market, though, with numbers and guidance from Apple, Amazon, Alphabet, Meta Platforms and Microsoft.