NEW YORK (Reuters) – U.S. stocks backed off record highs and bond yields rose following mixed earnings and rosier-than-expected economic sentiment from the European Central Bank’s governor.

The ECB signaled its intention to explore monetary easing but did not cut interest rates, and bank President Mario Draghi sounded more upbeat on the economy than investors expected, sending equities lower and boosting government debt yields.

“The ECB’s rosier outlook may be giving the market a bit of a chill,” said Chuck Carlson, chief executive of Horizon Investment Services in Hammond, Indiana. “The market continues to hope for dovish central banks and the actions of one central bank lead the market to wonder what that means for the Federal Reserve.”

A mixed bag of earnings reports from a wide range of U.S. companies pulled Wall Street lower a day after the S&P 500 and the Nasdaq hit all-time highs, painting a picture of profit beats amid underwhelming guidance.

“Earnings have been decent, but the guidance isn’t what the market is looking for,” Carlson added.

Downbeat guidance points to an economic slowdown in the midst of the protracted U.S.-China trade war, which should encourage the U.S. Federal Reserve to cut interest rates next Wednesday for the first time in a decade.

“The Fed has kind of backed itself into a corner to cut rates in July,” said Carlson. “But there are people at the Fed who are asking ‘why are we cutting rates again?’ You’ve got a market at all-time highs. That tug of war is going to go on.”

The Dow Jones Industrial Average fell 169.35 points, or 0.62%, to 27,100.62, the S&P 500 lost 17.65 points, or 0.58%, to 3,001.91 and the Nasdaq Composite dropped 79.87 points, or 0.96%, to 8,241.63.

European stocks reversed their initial gains in reaction to the ECB’s easing intentions after Draghi said the risk of a recession in the euro zone was “pretty low” and the central bank would wait for more data before “taking action.”

The pan-European STOXX 600 index declined 0.56% and MSCI’s gauge of stocks across the globe fell 0.55%.

U.S. Treasury yields rose after Draghi said the ECB sees a low risk of a recession in the euro zone, even as he acknowledged a worsening outlook.

Benchmark 10-year notes were last down 8/32 in price to yield 2.0775%, compared with 2.05% late on Wednesday.

The 30-year bond last fell 21/32 in price to yield 2.6083%, compared with 2.578% late on Wednesday.

The dollar index, which measures the greenback against a basket of other world currencies, inched higher, while the euro gave up earlier gains to show a nominal decline.

The dollar index rose 0.11%, with the euro down 0.02% at $1.1137.

The Japanese yen weakened 0.45% versus the greenback at 108.70 per dollar, while sterling was last trading at $1.2452, down 0.23% on the day.

Oil prices rose as Middle East tensions and a substantial drop in U.S. crude stocks raised supply concerns.

U.S. crude rose 1% to $56.44 per barrel and Brent was last at $63.75, up 0.9% on the day.

Spot gold dropped 0.8% to $1,414.60 an ounce.

Copper fell 0.28% to $5,982.00 a tonne.

Three-month aluminum on the London Metal Exchange eased 0.03% to $1,825.50 a tonne.

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