U.S. stocks turn higher; Netflix slumps on slower growth

Stocks were mostly higher in afternoon trading Wednesday as investors continued to work through company earnings reports and closely watch the bond market.

The S&P 500 index rose 38.48 points to snap a two-day slide.

The Dow Jones Industrial Average rose 316.01 points to 34,137.31 and the Nasdaq rose 163.95 to finish at 13,950.22.

Small-company stocks far outpaced the broader market after slumping a day earlier. The Russell 2000 was up 2% around midday.

Bond yields rose. The yield on the 10-year Treasury inched up to 1.57% from 1.56% late Tuesday. Both the gains for small stocks and bond yields are signs that investors are feeling more confident about economic growth.

Netflix slumped 7% for the biggest decline in the S&P 500. The video streaming pioneer disappointed investors with its latest report on subscriber additions, which came in below its own forecasts. The gangbuster growth Netflix had seen during the pandemic appeared to be slowing as people start leaving their homes more and as competition from rival services picks up.

Railroad operator CSX said its first-quarter profit fell because of higher expenses, but it expects to benefit as the U.S. economy strengthens further over the rest of the year. The stock rose 4.4%

Surgical device maker Intuitive Surgical rose 9.6% after handily beating analysts’ first-quarter forecasts. Medical device maker Edwards Lifesciences rose 5.6% after also reporting strong financial results.

Investors are looking to justify the market’s advance this year, despite the lingering pandemic and higherthan-normal unemployment. There are also signs of COVID infections increasing outside the U.S. in major economies such as India and Brazil once again.

Big companies to report their results after Wednesday’s closing bell include Newport Beach-based Chipotle Mexican Grill and Las Vegas Sands. Both companies have been heavily hit by the pandemic, as many Americans cut back on travel and dining out at restaurants.