Wall Street's major indexes finished lower on Wednesday (Thursday AEST), with the Nasdaq leading declines as investors turned cautious amid earnings from technology heavyweights, while higher oil prices and renewed geopolitical tensions weighed on sentiment.
The Dow Jones Industrial Average slipped 6.1 points, or 0.01%, to 52,218.6, the S&P 500 fell 10.2 points, or 0.1%, to 7,499.0, and the Nasdaq Composite dropped 146.3 points, or 0.6%, to 25,690.9.
Attention centred on second-quarter earnings from Alphabet and Tesla, the first of the so-called "Magnificent Seven" technology giants to report this season.
Investors were looking for fresh evidence that billions of dollars of artificial intelligence spending are translating into stronger earnings and sustained growth.
Alphabet ended the session 1.5% lower and fell 3.1% in extended deals, as investors remained cautious following a delay to the launch of a key AI model central to the company's strategy.
Texas Instruments rose 1% during regular trading but slipped 3.1% in extended trade after releasing quarterly results, despite forecasting current-quarter revenue above market expectations.
Tesla closed 1.3% lower before extending losses after the bell, falling a further 4% after reporting negative free cash flow in the second quarter for the first time in more than two years.
With several major companies still to report, investors remained wary that the busy earnings calendar could trigger sharper market swings over the coming days.
Geopolitical concerns also returned to the forefront after crude oil futures climbed around 3% to their highest settlement since 11 June.
Prices were lifted by threats from Yemen's Iran-backed Houthi militia against shipping in the Red Sea, a vital global trade route alongside the Strait of Hormuz.
Adding to tensions, U.S. President Donald Trump said the United States would destroy an Iranian bridge or power plant every time Iran fired on a ship transiting the Strait of Hormuz.
Among individual movers, Super Micro Computer surged 19.8% to become the S&P 500's best-performing stock after the server maker announced it had secured more than US$60 billion in new orders during the fourth quarter. Dell Technologies also rallied 9.3% in sympathy.
AT&T gained 3.5% after the telecommunications company reported stronger-than-expected wireless subscriber additions during the second quarter.
On the bond markets, U.S. Treasury yields moved higher, with the 10-year yield rising 0.7% to 4.659% and the two-year yield climbing 1% to 4.304%.
