Major market averages opened trading lower on Wednesday as investors brace for Tesla results after the close of trading.
Tesla (TSLA) shares were lower premarket after cutting U.S. prices again. Netflix (NFLX) was also down following its results after the bell Tuesday, adding to pressure on the growth sector.
Nasdaq Composite (COMP.IND) -0.5%, S&P 500 (SP500) -0.3% and Dow (DJI) -0.3% were down.
“Netflix’s first quarter has failed to set the market alight, in what is the first of big tech to go in the earnings quarter that’s expected to be the worst since the pandemic started," Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said. "Fundamental metrics show the business is in reasonable shape, but investors need a little more than that to shake off remaining concerns about a downturn lurking in the shadows."
Rates were higher. The 10-year Treasury yield (US10Y) rose 4 basis points to 3.61%. The 2-year yield (US2Y) rose 5 basis points to 4.24%.
"For now the looser market-based financial conditions have helped cement investors’ conviction that the Fed is set to deliver another hike in just two weeks’ from now, which was supported by the latest round of FOMC speakers," Deutsche Bank's Jim Reid said.
The Fed's Beige Book comes out at 2 p.m. ET.
"As anecdotal evidence, the information is subject to whims and biases," UBS' Paul Donovan wrote. "Investors will look to see if the consumer has accelerated the slowdown, and if bank lending standards are tightening. Corporate anecdotes are unlikely to give an honest assessment of profit-led inflation."
Among active stocks, shares of Bed Bath & Beyond soared as traders bet on bankruptcy versus survival odds.