*

US stocks end down as investors digest earnings

*

London stocks jump after inflation data

*

Gold declines again after sharpest fall in over 5 years

*

Netflix ( NFLX ) shares drop after disappointing outlook

(Updates with US closing levels)

By Caroline Valetkevitch

NEW YORK, Oct 22 (Reuters) - Most major stock indexes

fell on Wednesday, with Netflix ( NFLX ) shares down after the

company's outlook disappointed, while spot gold prices declined,

a day after they had the sharpest single-day drop in over five

years.

Gold, one of the year's best-performing trades, slid as

investors booked profits. It remains on course for its strongest

year since the 1979 oil crisis and is up more than 50% so far

this year. Spot gold was last down 0.53% at $4,102.09 an

ounce.

Wall Street's three major indexes ended lower, with

shares of Netflix ( NFLX ) falling 10.1% and weighing on the

market. Tesla, the first of the Magnificent Seven

group of megacap stocks to report this U.S. earnings season,

ended the session down 0.8% ahead of its quarterly report. They

were slightly lower in extended trading following the company's

results.

Investors also digested developments on the trade front.

Reuters reported, citing a U.S. official and three people

briefed by U.S. authorities, that the Trump administration is

considering a plan to curb a dizzying array of software-powered

exports to China, from laptops to jet engines, to retaliate

against Beijing's latest round of rare earth export

restrictions.

"It looks like we're letting a little air out of the

balloon," said Oliver Pursche, senior vice president at

Wealthspire Advisors in Westport, Connecticut.

"Given the sharp rally and gains that we've made year to

date, and in particular since the beginning of April, combined

with the concerns over future economic growth and the absence of

data due to the government shutdown, there's no reason to make

material moves in either direction," but maybe "you're going to

take some profits; you're going to do some rebalancing," he

said.

Wednesday marked the 22nd consecutive day for the U.S.

federal government shutdown.

The Dow Jones Industrial Average fell 334.33

points, or 0.71%, to 46,590.41, the S&P 500 fell 35.95

points, or 0.53%, to 6,699.40 and the Nasdaq Composite

fell 213.27 points, or 0.93%, to 22,740.40.

MSCI's gauge of stocks across the globe

fell 4.16 points, or 0.42%, to 990.69.

The pan-European STOXX 600 index fell

0.18%. However, London stocks rose for a third consecutive day

as investors increased bets on interest rate cuts from the Bank

of England after data showed inflation unexpectedly held steady.

The blue-chip FTSE 100 gained 0.9%. Sterling fell

by as much as 0.5% against the dollar. It was last down 0.13%.

U.S. Treasury

yields

slid for a third straight session, though the market was

range-bound as the U.S. federal government dragged on with no

resolution in sight.

U.S. yields further extended their fall in afternoon

trading after a decent $13-billion auction of 20-year bonds. In

afternoon trading, the benchmark 10-year yield was down 1.4

basis points (bps) at 3.949%.

The Federal Reserve is expected to reduce rates two more

times this year, with a quarter-percentage-point cut baked in

for the October 28-29 meeting, according to LSEG calculations

using rate futures.

The dearth of U.S. economic data due to the ongoing shutdown

means that policymakers could be left flying blind at the

meeting, a less-than-ideal situation as they remain divided over

which risks deserve the most attention.

The yen was nearly flat against the dollar. Japan's new

Finance Minister Satsuki Katayama said on Wednesday that it is

necessary for the government and the Bank of Japan to coordinate

to make economic and monetary policies effective. The BoJ is

scheduled to announce its next policy decision on October 30.

On Tuesday, sources told Reuters that the new prime

minister, Sanae Takaichi, is preparing an economic stimulus

package likely to exceed last year's 13.9 trillion yen ($92.19

billion) to help households tackle inflation.

The dollar index, which measures the greenback

against a basket of currencies including the yen and the euro,

fell 0.05% to 98.93, with the euro up 0.06% at $1.1605.

Against the Japanese yen, the dollar strengthened 0.04%

to 151.99.

Oil prices ended higher. U.S. crude rose $1.26 to

settle at $58.50 a barrel and Brent gained $1.27 to

settle at $62.59.