NEW YORK (AP) -- Wall Street is taking a pause on Wednesday, a day after rallying to its best day in weeks, following a mixed set of profit reports from big U.S. companies.
The S&P 500 was drifting between small gains and losses and was down 0.3% in early trading, a day after soaring 2.8%. The Dow Jones Industrial Average was down 142 points, or 0.4%, at 31,684, a little past 10 a.m. Eastern time, and the Nasdaq composite was 0.1% higher.
Profit reporting season is ramping up for big companies, with more types of industries offering details about how high inflation and a possible recession are affecting their customers. A lot is riding on whether they can continue to deliver healthy profits.
Stocks tumbled roughly 20% from their highs this year because of worries about rising interest rates, and proof that profits can remain strong would provide a big support for markets. On the other hand, warnings about upcoming weakness could kick off another leg downward.
Companies have mostly been topping profit expectations so far this reporting season, as is usually the case.
Nasdaq, the company behind its namesake trading exchange, jumped 5.1% after delivering stronger profit and revenue than Wall Street expected. Comerica, the Dallas-based financial services company, added 0.9% after it also reported stronger-than-expected results.
Netflix rose 1.2% after it said it lost fewer subscribers during the spring than expected. It, though, remains the worst stock in the S&P 500 for the year, down by roughly two thirds.
On the losing end was Baker Hughes, which tumbled 11.6% after it reported weaker results for the spring than analysts expected. Northern Trust fell 5.4% after its profit fell short of forecasts.
In Europe, stocks were slipping amid worries about whether Russia would restrict supplies of natural gas headed for the region after some maintenance on a key pipeline is scheduled to end Thursday. Germany's DAX dropped 0.7%, and French stocks dipped 0.6%.
The continent is also preparing for the first increase in interest rates by the European Central Bank in 11 years on Thursday, as it tries to beat back inflation.
The U.S. Federal Reserve has already hiked rates three times this year, by increasing margins each time. When it meets next week, investors say the only question is if it raises its key rate by another 0.75 percentage points or opts for a mega-hike of a full percentage point.
Such increases to rates make borrowing more expensive, which slows the economy. The hope is that the Federal Reserve and other central banks can deftly find the middle ground where the economy slows enough to whip inflation but not enough to cause a recession.
Some parts of the economy are already slowing because of the rate hikes, particularly the housing industry. A report on Wednesday morning showed that sales of previously occupied homes weakened last month by more than economists expected.
In the bond market, the yield on the two-year Treasury, which tends to follow expectations for the Fed's actions, fell to 3.19% from 3.24% late Tuesday. The 10-year yield slipped to 2.97% from 3.01%.