Wall Street ends red as US stocks struggle ahead of Tesla, Alphabet results

Wall Street’s major market averages finished lower on Wednesday, as investors geared up to assess earnings reports from major technology companies.

The blue-chip Dow (DJI) closed flat, the benchmark S&P 500 (SP500) ended -0.1%, and the Nasdaq Composite (COMP:IND) finished -0.6%.

From a sector-by-sector perspective, six of the 11 S&P segments were up in the green and were led by utilities. On the other end, communication services was the weakest area. 

Over in the bond market, the 10-year Treasury yield (US10Y) rose 3 basis points to 4.66%, while the 2-year Treasury yield (US2Y) was 4 basis points higher at 4.32%.

“The market seems to be on pins and needles as earnings near. This is the height of earnings season and will go a long way toward helping us understand how the economy is doing outside of broader economic data that the U.S. government reports,” said Seeking Alpha analyst Daniel Jones.

“It is looking increasingly likely that the Federal Reserve will hike interest rates before this year is out. Add on top of this weakening fundamentals, and I would say that we are likely to enter into a recession before long. And I would urge investors to tread cautiously because of it,” Jones added.

On the earnings front, Tesla (TSLA) and Alphabet (GOOG) (GOOGL) are scheduled to report quarterly results later in the day, with investors looking for updates on artificial intelligence spending, advertising demand, and the outlook for the technology sector. 

On the economic agenda, year-ahead business inflation expectations eased in July, while mortgage demand rose during the week ended July 17.

Oil prices continued to rise. Crude oil futures (CL1:COM) were higher at $86, while Brent (CO1:COM) was $93 per barrel.