Stocks are little changed Wednesday as investors brace for more earnings, Netflix pops

U.S. stock futures declined on Wednesday, after coming off a sharp rally in the previous session, as traders brace for a choppy earnings season.

Dow Jones Industrial Average futures fell 31 points, or 0.1%. S&P 500 dipped 0.08% and Nasdaq 100 futures gained 0.03%.

Some investors have been encouraged by the recent trading action, believing it is signaling that the bear market has bottomed. NYSE stocks achieved a widely followed "90% up day" on Tuesday with more than 90% of stocks listed on the exchange advancing and accounting for more than 90% of the volume.

"We view this bullish breadth day as a sign that the summer rebound for U.S. equities can continue," wrote Stephen Suttmeier, technical research strategist for Bank of America, in a note Wednesday.

The Dow rallied more than 700 points during Tuesday's session, with the S&P 500 and Nasdaq soaring 2.8% and 3.1%, respectively. The three benchmarks also closed above their respective 50-day moving averages for the first time since April.

Investors pointed to deteriorating sentiment that potentially set up a buying opportunity in the market. A survey from Bank of America suggested investors' bearishness could mean stocks could rise from here. Meanwhile, the U.S. dollar, which recently surged to a 20-year high against the euro, softened, giving the rally more steam.

Still, some market participants were skeptical of the bounce.

"Despite Tuesday's more positive trading session, we don't expect a sustained improvement in market sentiment until investors get greater clarity on the outlook for the economy, central bank policy, and political risks," UBS' Mark Haefele wrote in a Wednesday note.

A report from the Mortgage Bankers Association pointed to more pain for U.S. consumers as they deal with higher prices and interest rates. Mortgage demand declined more than 6% last week compared with the prior week, dropping to its lowest level in 22 years.

Netflix surged more than 7% in after-hours trading after saying it lost only 970,000 subscribers in the second quarter, less than the 2 million it had previously projected. The streaming giant's earnings per share also came in above analyst expectations.

Biogen and Baker Hughes are among the companies set to report later in the morning. Tesla and United Airlines are slated to post their latest quarterly results after the close.

About 10% of S&P 500 companies have reported earnings thus far. Of those companies, nearly 69% have beaten analyst expectations, according to FactSet. Investors had been awaiting this earnings season as they search for clues on how companies are faring with inflation at levels not seen in 40 years.