After Hours Report

The stock market retreated today as a handful of key earnings misses, geopolitical uncertainty, and weakness across the market's largest names combined to create a risk-off disposition that pushed the major averages lower. 

The S&P 500 (-0.5), Nasdaq Composite (-0.9%), and DJIA (-0.7%) steadily retreated to session lows at around 2:00 ET before improving slightly to the close. The small-cap Russell 2000 (-1.5%) and S&P Mid Cap 400 (-1.2%) underperformed as the investors rotated into more defensive pockets. 

Growth-oriented and high-beta sectors paced the losses throughout the day. 

The communication services sector (-0.9%) finished with one of the widest losses today after Netflix (NFLX 1116.37, -124.98, -10.07%) reported a rare earnings miss. The company topped revenue estimates but missed on earnings, citing a Brazilian gross tax on outbound payments. Management noted that excluding this one-time charge, operating income and margins would have surpassed Q3 guidance. However, the stock traded sharply lower throughout the session and never received any buy-the-dip interest.

The top-weighted information technology sector (-0.8%) also faced some earnings-induced pressure. Texas Instruments (TXN 170.71, -10.13, -5.60%) missed EPS estimates for the first time in two years and issued Q4 guidance below consensus. Management noted that the semiconductor recovery is progressing, though at a slower pace than in previous cycles, as customers remain cautious amid macro and tariff uncertainty.

The PHLX Semiconductor Index retreated 2.4% as chipmaker names moved lower. 

Elsewhere in the sector, Apple (AAPL 258.45, -4.32, -1.64%) finished lower after a solid gain yesterday and reports of weaker-than-expected demand for the new iPhone Air. 

The mega-cap group largely underperformed today, which weighed on the consumer discretionary sector (-1.0%). Amazon (AMZN 217.99, -4.04, -1.82%) traded lower after a nice gain yesterday, as did Tesla (TSLA 438.72, -3.88, -0.88%), which is set to report earnings after the close, one of the most anticipated happenings of the week. 

The Vanguard Mega Cap Growth ETF closed 0.7% lower. The Invesco S&P 500 High Beta ETF (-1.4%) also faced a retreat as investors rotated out of more volatile stocks.

Meanwhile, the industrial sector (-1.3%) closed with the widest loss today. The sector retreated after GE Vernova (GEV 576.23, -9.10, -1.55%) missed earnings estimates, while aerospace and defense stocks saw some profit-taking after yesterday's rally. 

Only four S&P 500 sectors closed with gains today. 

The energy sector (+1.3%) was the only sector to move more than 1.0% higher, supported by crude oil futures settling today's session $1.27 higher (+2.2%) at $58.51 per barrel.

The market's risk-off sentiment saw the consumer staples (+0.6%) and health care (+0.6%) sectors capture gains, with the health care sector boosted by a strong gain in Intuitive Surgical (ISRG 527.03, +64.29, +13.89%) following its earnings beat.

Meanwhile, the real estate sector (+0.4%) captured a more modest gain. 

Lingering concerns around the trade relationship between the U.S. and China weighed on sentiment today. The market hit a pocket of volatility after Reuters reported that the Trump administration is weighing sweeping software export curbs on China in retaliation for rare earth restrictions. Treasury Secretary Scott Bessent confirmed the report to CNBC later in the afternoon. 

Additionally, Mr. Bessent told Fox Business that large sanctions on Russia will be announced tonight or tomorrow.

Ultimately, the market faced pressure on multiple fronts today. Earnings misses from prominent names prompted concerns of stretched valuations, while geopolitical and trade worries added to the air of uncertainty, making it all the more important for Tesla (TSLA 438.72, -3.88, -0.88%) and the other mega-caps to hold their ground and provide leadership, as investor sentiment remains highly sensitive to any signs of weakness.

U.S. Treasuries recorded modest gains on Wednesday with most tenors finishing essentially where they started. The 2-year note yield settled down two basis points to 3.44% and teh 10-year note yield settled down one basis point to 3.95%. 

• Nasdaq Composite: +17.8% YTD
• S&P 500: + 13.9% YTD
• Russell 2000: +9.9% YTD
• DJIA: +9.5% YTD
• S&P Mid Cap 400: +3.7% YTD

Reviewing today's data:

• The weekly MBA Mortgage Index fell 0.3% to follow last week's 1.8% decrease. The Purchase Index was down 5.2% while the Refinance Index rose 4.0%.