U.S. stocks snapped a winning streak to end a back-and-forth session lower Wednesday as a rally that kicked off the week faltered despite better-than-feared earnings reports.

The S&P 500 (^GSPC) sank 0.7% after the index gained more than 4% in the past two days, while the Dow Jones Industrial Average (^DJI) shed around 100 points, or 0.3%. The technology-heavy Nasdaq Composite (^IXIC) was off by 0.9%. Meanwhile, the benchmark 10-year Treasury note spiked above 4.1%.

Netflix (NFLX) was in the spotlight following a big earnings beat Tuesday afternoon that included 2.41 million new subscribers – a key metric watched by analysts – more than double Wall Street’s estimate of 1 million additions. Executives noted in the earnings statement that the company is “on a path to reaccelerate growth” after a challenging first half of the year. Shares spiked up 13.1% on Wednesday.

Elsewhere on the earnings front, Abbot Laboratories (ABT) stock fell 6.4% after the medical device-maker reported weaker-than-expected growth in international medical device sales due to headwinds from a strong U.S. dollar and supply issues in China.

Shares of United Airlines Holdings (UAL) closed nearly 5% higher after the airline reported higher-than-expected third-quarter earnings results due to strong travel demand and a profit forecast for the current quarter that exceeded Wall Street estimates.

Strong reports from Netflix and United Airlines add to a batch of generally upbeat corporate results rolled out earlier in the week from companies including Goldman Sachs (GS) and Johnson & Johnson (JNJ).

Although figures have so far come in better than anticipated, of companies that have reported results for Q3 to date, only 69% posted actual earnings per share above estimates – below the 5-year average of 77%, according to FactSet Research. And of those that topped estimates, earnings beats have come in 0.1% above estimates, far lower than the 5-year average of 8.7%.

Signage at the Netflix booth is seen on the convention floor at Comic-Con International in San Diego, California, U.S., July 21, 2022. REUTERS/Bing Guan

Many Wall Street strategists have emphasized that valuations have yet to fully reflect the lower earnings that are consistent with the slowdown in economic growth underway, pointing to forward earnings projections that remain far too high.

“If, as we expect, Q3 earnings disappoint and forward earnings expectations are guided lower, we may yet see another down leg for equities,” Gargi Chaudhuri, head of iShares investment strategy at BlackRock said in a note. “Don’t be fooled or chase these bear market rallies.”

“The market will, of course, eventually bottom, but until the Fed pivots or earnings are properly marked down, we think that time has yet to arrive,” Chaudhuri said.

NEW YORK, NEW YORK - OCTOBER 18: Traders work on the floor of the New York Stock exchange during morning trading on October 18, 2022 in New York City. The stock market opened on an upswing with the Dow Jones gaining over 600 points, the S&P 500 jumping 2.20% and the Nasdaq Composite with a gain of 2.6% adding to the gains that began on Monday.  (Photo by Michael M. Santiago/Getty Images)

NEW YORK, NEW YORK – OCTOBER 18: Traders work on the floor of the New York Stock exchange during morning trading on October 18, 2022 in New York City. (Photo by Michael M. Santiago/Getty Images)

In commodities markets, oil pushed higher amid concerns that fresh European sanctions on Russia may further squeeze supply. The Biden administration is expected to announce a plan Wednesday to release 15 million barrels from U.S. strategic reserves to quell gas prices. West Texas Intermediate (WTI) crude futures were up roughly 3.4% to trade above $85 per barrel.

Across the Atlantic, the U.K. extended a volatile stretch as investors assessed a double-digit inflation print for September of 10.1%, putting a recent emergency move by the Bank of England to sell government bonds into question. The pound weakened and gilts moved lower.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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