* Netflix tumbles as U.S. subscribers drop
* Union Pacific, Phillip Morris jump after results
* Morgan Stanley beats profit estimates
* Indexes down: Dow 0.39%, S&P 0.22%, Nasdaq 0.47% (Updates to early afternoon)
By Medha Singh and Uday Sampath Kumar
July 18 (Reuters) - Wall Street's main indexes were set fortheir third day of losses on Thursday, as Netflix reported asurprise fall in U.S. subscribers in a downbeat start to resultsfrom high-growth companies.
Shares of the streaming pioneer NFLX.O tumbled 11.1% totheir lowest since late-January at $321.84, as the company alsomissed targets for new subscribers overseas at a time when ithas staked its future on global expansion. urn:newsml:reuters.com:*:nL4N24I3TB
Losses in Netflix triggered a 1.58% fall in thecommunication services .SPLRCL sector, one of thebest-performing S&P sectors so far this year.
Technology giant Microsoft CorpMSFT.O slipped 0.8% aheadof its results after markets close.
"The stock market seems to be running out of energy," saidJohn Augustine, chief investment officer of Huntington PrivateBank in Columbus, Ohio.
"Earnings have met expectations but companies are beingcautious about future quarters, which is something that's notable to keep the S&P 500 above the 3,000 level."
As second-quarter earnings rolled in this week, the threemain Wall Street indexes retreated slightly from record highsand are set for their steepest weekly fall in seven weeks.
Investors are looking for concrete developments in tradetalks between the United States and China, while they await theFederal Reserve's policy meeting at the end of July where thecentral bank is widely expected to cut interest rates.
Treasury Secretary Steven Mnuchin said U.S. and Chineseofficials will hold a telephone call later on Thursday thatcould pave the way for further in-person trade talks. urn:newsml:reuters.com:*:nW1N219018
At 12:08 p.m. ET, the Dow Jones Industrial Average .DJI was down 105.12 points, or 0.39%, at 27,114.73 and the S&P 500 .SPX was down 6.64 points, or 0.22%, at 2,977.78. The NasdaqComposite .IXIC was down 38.16 points, or 0.47%, at 8,147.04.
Among positive earnings reports, tobacco company PhilipMorris PM.N climbed 8.3% after raising its full-year profitoutlook, while railroad operator Union Pacific CorpUNP.N jumped 4.2% after reporting a profit beat. urn:newsml:reuters.com:*:nL4N24J31S
International Business Machines CorpIBM.N rose 3.8% asits quarterly profit beat on strong growth in its high-margincloud business. urn:newsml:reuters.com:*:nL4N24I3UE
Morgan StanleyMS.N rose 0.7% after posting abetter-than-expected quarterly profit and wrapped up earningsfrom big U.S. banks. The bank-subsector .SPXBK was up 0.73%after three days of losses. urn:newsml:reuters.com:*:nL4N24J2XQ
Profits for S&P 500 companies is expected to rise 0.6% thisyear, according to Refinitiv IBES data. Until Wednesday, therewere expectations of a dip in earnings.
UnitedHealth Group IncUNH.N slipped 2.5% as the insurersaid 2019 revenue would not hit its original target on theconference call. urn:newsml:reuters.com:*:nL4N24J3CC
Declining issues outnumbered advancers for a 1.40-to-1 ratioon the NYSE and for a 1.21-to-1 ratio on the Nasdaq.
The S&P index recorded 20 new 52-week highs and four newlows, while the Nasdaq recorded 41 new highs and 74 new lows. (Reporting by Medha Singh and Uday Sampath in Bengaluru;Editing by Sriraj Kalluvila and Anil D'Silva) ((Medha.Singh@thomsonreuters.com; within U.S. +1646 223 8780,outside U.S. +91 80 6749 1130; Twitter: https://twitter.com/medhasinghs; Reuters Messaging: email@example.com))