US benchmark equity indexes experienced a decline on Wednesday as traders evaluated the most recent corporate earnings and economic data released. The Nasdaq Composite dropped 1.6%, settling at 18,276.7, while the Dow Jones Industrial Average fell 1% to 42,515. The S&P 500 lost 0.9%, closing at 5,797.4.
Among the sectors, consumer discretionary and technology faced the most significant challenges, with only real estate and utilities managing to close higher on the day. In company-specific news, Enphase Energy ($ENPH) witnessed a steep fall of nearly 15%, marking it as the worst performer on the S&P 500.
The company's financial results for the third quarter did not align with Wall Street's expectations, leading to multiple downgrades from analysts following the announcement made late Tuesday. Similarly, CoStar Group ($CSGP) faced a decrease of 5.3%, further solidifying its position among the worst performers on both the S&P 500 and the Nasdaq indexes.
The company's third-quarter revenue figures failed to meet analysts' forecasts, contributing to its share price decline. On the Dow, McDonald's ($MCD) recorded a notable decrease of 5.1%, becoming one of the top decliners on the S&P 500 as well. Reports from US health authorities indicated an ongoing investigation into an E.
coli outbreak tied to the fast-food chain's Quarter Pounder burgers, prompting concerns among investors. In contrast, Teledyne Technologies ($TDY) emerged as the second-best performer on the S&P 500, with shares climbing 6% following a strong third-quarter performance. The telecommunications giant, AT&T ($T), reported an unexpected decline in third-quarter revenue due to challenges within its business wireline segment, which led to a significant multi-billion dollar write-down.
Nonetheless, the company's shares increased by 4.6%, placing it among the top gainers on the S&P 500. In bond market activity, the US 10-year yield saw a rise of 3.8 basis points, reaching 4.24%, while the two-year rate increased by 4.3 basis points to 4.08%. Moving on to economic indicators, economic activity remains "little changed" across nearly all Federal Reserve districts since early September, according to the latest Beige Book released by the central bank.
However, there is a slight uptick in the long-term outlook, indicating improved optimism. The report also noted a decline in manufacturing activity in most districts, based on data collected as of October 11. Additionally, US existing home sales dropped unexpectedly in September, despite indicators that typically suggest a rise in sales.
National Association of Realtors Chief Economist Lawrence Yun commented, "There are more inventory choices for consumers, lower mortgage rates than a year ago, and continued job additions to the economy." The Mortgage Bankers Association revealed a decrease in mortgage application volume in the US, bringing it to the lowest level since July, attributed to reduced purchase and refinancing activities. Crude oil prices fell by 1%, with West Texas Intermediate dropping to $71 a barrel.
Additionally, the Energy Information Administration reported a rise in commercial crude stockpiles, which increased by 5.5 million barrels to a total of 426 million barrels for the week ending Friday, exceeding the Bloomberg poll consensus prediction of a 1 million barrel gain. In precious metals, gold saw a decline of 1.1%, trading at $2,729 per troy ounce, while silver fell by 3.3% to $33.87 per ounce..