Wall Street slipped on Wednesday, with Netflix’s weak profit weighing on sentiment as investors monitored a flood of corporate earnings to get clarity in a high-stakes reporting season.

Shares of Netflix dropped 7.8% on Wednesday after the streaming giant’s fourth-quarter revenue outlook failed to excite investors.

At 09:39 a.m., the Dow Jones Industrial Average fell 59.20 points, or 0.13%, to 46,865.54, the S&P 500 lost 0.67 points, or 0.01%, to 6,734.68 and the Nasdaq Composite lost 48.89 points, or 0.21%, to 22,904.77.

Texas Instruments lost 7.7% after lower-than-expected revenue and profit forecasts from the chipmaker.

Peers Microchip Technology, ON Semiconductor lost and Analog Devices dropped between 2.3% and 4.5%. The Philadelphia Semiconductor Index was down almost 1% after hitting an all-time high on Monday.

With equities hovering near record highs and valuations stretched thin, investors need more than earnings beats to justify lofty price tags.

All eyes will be on Tesla as it kicks off the ‘Magnificent Seven’ earnings lineup after the closing bell. The Mag Seven collectively account for close to 35% of the S&P 500’s total market capitalization.

The big question is whether “the mega cap tech earnings (would) look like Netflix or are they going to be more positive,” said Alex Coffey, senior trading & derivatives strategist at Charles Schwab.

“So much of the earnings growth has been tied to those companies,” he said, adding that if they fail to deliver, the market would possibly go down.

AT&T added more wireless subscribers than expected for the third quarter, but its shares fell 3%.

So far, 78 S&P 500 companies have reported, with 87% beating estimates, according to LSEG data. Analysts expect third-quarter earnings growth of 9.2% year-on-year, up from 8.8% at the start of the month.

Geopolitics and Data Troubles

Geopolitical jitters continued. A planned summit between U.S. President Donald Trump and Russian President Vladimir Putin was put on hold, while uncertainty swirled around a potential meeting with Chinese President Xi Jinping.

Despite recent signs of tensions thawing between Washington and Beijing, Trump reignited doubts on Tuesday, saying the meeting with Xi “maybe won’t happen.”

Trump refused to meet top Democrats until the three-week-old government shutdown ends, leaving the Federal Reserve short on data ahead of next week’s policy meeting. Friday’s data — with core CPI expected to hold at 3.1% — may be the Fed’s only clear read on inflation.

Among other moves, Intuitive Surgical shares jumped 15.5% after the company’s third-quarter results beat estimates.

Amphenol forecast fourth-quarter results above expectations, sending its shares up 6.6%.

Mattel shares slipped 3.8% after the Barbie-maker missed Wall Street estimates for third-quarter revenue and profit.

Advancing issues outnumbered decliners by a 1.25-to-1 ratio on the NYSE and by a 1.53-to-1 ratio on the Nasdaq.

The S&P 500 posted 6 new 52-week highs and one new low while the Nasdaq Composite recorded 16 new highs and 26 new lows.

—

(Reporting by Pranav Kashyap and Twesha Dikshit in Bengaluru; Editing by Arun Koyyur and Shinjini Ganguli)