Wall St set to open lower when Netflix slides, boxes go up
Major Wall Street indices are expected to open lower on Wednesday as Netflix kicked off the tech giants’ quarterly results with a disappointing report, as concerns over a surge in coronavirus cases around the world hit demand for actions.
The streaming service provider (NFLX.O) fell 9.2% in pre-market commerce after its report showed that the slowdown in TV show and movie production during the pandemic had hurt growth in subscribers in the first quarter.
Shares of large-cap companies, including Apple Inc (AAPL.O), Amazon.com Inc (AMZN.O), Facebook Inc (FB.O) and Tesla Inc (TSLA.O), fell 0.4% and 0.7%.
“Netflix is certainly weighing on the tech industry this morning,” said Dennis Dick, head of market structure and owner trader at Bright Trading LLC in Las Vegas.
“We’re getting to the heart of all the major tech stocks reports next week and the first one didn’t do very well and now it’s lowering the bar for Apple and Microsoft and so on.”
Wall Street closed lower in the previous session, as a global spike in coronavirus cases hit travel-related stocks and investors had doubts about the seemingly stellar earnings of major U.S. banks last week.
Global stocks were also low on Wednesday amid growing concerns over the spike in COVID-19 infections in Asia and their impact on oil prices.
With the acceleration of the first quarter earnings season, analysts expect S&P 500 company profits to jump 30.9% from a year earlier, according to data from Refinitiv IBES.
As of 8:26 a.m. ET, Dow e-minis were down 33 points, or 0.1%, S&P 500 e-minis, 7 points, or 0.17%, and Nasdaq 100 e-minis. , by 53.25 points, or 0.39%.
Verizon Communications Inc (VZ.N) fell 0.3% as it said it lost more wireless subscribers than expected in the first quarter due to intense competition. Shares of T-Mobile US Inc (TMUS.O) and AT&T Inc (TN) also fell.
U.S. rail operator CSX Corp (CSX.O) fell 0.5% after missing first-quarter profit estimates, hurt by freezing polar vortex temperatures, ongoing pandemic disruptions and rising costs of the fuel.
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