The Dow Jones Industrials came off their lows of the morning, but remained negative 327.06 points, or 1.1%, to break for lunch at 30.609.98.
The S&P 500 slipped 57.93 points, or 1.5%, to 3,791.69.
The NASDAQ was in the red 181.66 points, or 1.3%, to 13,444.41.
Boeing fell more than 5% after its earnings report showed 2020 net loss hit a record of $11.9 billion amid the 737 Max grounding and the coronavirus pandemic. Shares of AMD tumbled more than 7% even after the chipmaker posted revenue and earnings that beat Wall Street’s already high expectations.
Intensifying speculative behavior among retail investors is causing concern. Heavily shorted names, including GameStop and AMC Entertainment, continued to be pushed higher by amateur day traders in online chat rooms.
Some investors are worried about mounting losses by hedge funds spilling over to other areas of the market as those funds sell other securities to raise cash. Investors are also concerned the speculative behavior is a sign the market is overvalued and a pullback is near.
Microsoft was up slightly after reporting a stellar quarter. Sales grew by 17% on a year-over-year basis in its fiscal second quarter, while its cloud business accelerated.
Starbucks topped earnings estimates for the last quarter, but its U.S. same-store sales fell 5% amid rising cases of COVID-19. Shares of the coffee chain fell more than 5%.
Apple, Facebook and Tesla are due to report earnings after the closing bell. They represent three of the six largest companies in the U.S. by market cap, meaning fluctuations in their stock prices have an outsized impact on the performance of the broader S&P 500.
Intensifying speculative behavior among retail investors is causing many on Wall Street to raise a red flag. Heavily shorted names, including GameStop and AMC Entertainment, continued to be pushed higher by amateur day traders in online chat rooms.
GameStop shares exploded again, more than doubling on Wednesday. Media outlets learned Melvin Capital, the hedge fund targeted by the retail crowd on Reddit had sold out of its short position. AMC was up more than 300%.
Investors will also keep a close eye on comments from Fed Chairman Jerome Powell, who is expected to speak with reporters during a press conference Wednesday afternoon following the Fed’s latest interest rate decision.
The central bank chief will likely explain how the Fed views the economic outlook and offer remarks about what, if any, monetary actions are needed to help further stabilize the U.S. economy.
Prices for 10-Year Treasurys were higher, lowering yields to 1.01% from Tuesday’s 1.04%. Treasury prices and yields move in opposite directions.
Oil prices reclaimed 55 cents to $53.16 U.S. a barrel.
Gold prices faded $4.10 to $1,846.80 U.S. an ounce.