By Shreyashi Sanyal and Devik Jain
(Reuters) – Wall Street’s main indexes were set to open lower on Wednesday as Netflix (NASDAQ:) kicked off quarterly earnings for technology behemoths with a disappointing report, while concerns about a surge in global coronavirus cases hit demand for equities.
The streaming service provider tumbled 9.2% in premarket trading after its report showed slower production of TV shows and movies during the pandemic hurt subscriber growth in the first quarter.
Shares of mega-cap firms, including Apple Inc (NASDAQ:), Amazon.com Inc (NASDAQ:), Facebook Inc (NASDAQ:) and Tesla (NASDAQ:) Inc, fell between 0.4% and 0.7%.
“Netflix is weighing on the tech sector for sure this morning,” said Dennis Dick, head of markets structure and a proprietary trader at Bright Trading LLC in Las Vegas.
“We get into the heart of all the major tech stocks reporting next week and the first one didn’t do that great and now that lowers the bar for Apple and Microsoft (NASDAQ:) etc.”
Wall Street closed lower in the previous session as a global spike in coronavirus cases hit travel-related shares and investors had second thoughts about big U.S. banks’ apparently stellar earnings last week.
Global stocks were also subdued on Wednesday due to rising concerns over spiking COVID-19 infections in Asia and their impact on oil prices. [MKTS/GLOB]
With the first-quarter earnings season picking up pace, analysts expect profit for companies to jump 30.9% from a year earlier, according to Refinitiv IBES data.
At 8:26 a.m. ET, were down 33 points, or 0.1%, were down 7 points, or 0.17%, and were down 53.25 points, or 0.39%.
Verizon Communications Inc (NYSE:) dropped 0.3% as it said it lost more wireless subscribers than expected during the first quarter due to intense competition. Shares of T-Mobile US (NASDAQ:) Inc and AT&T Inc (NYSE:) were also lower.
U.S. railroad operator CSX Corp (NASDAQ:) fell 0.5% after it missed estimates for first-quarter profit, hurt by frigid polar vortex temperatures, ongoing pandemic disruptions and higher fuel costs.
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