The CNN Money Fear and Greed index showed that the overall market sentiment fell, while the index declined from “Greed” to the "Neutral" zone on Wednesday.

U.S. stocks settled lower on Wednesday, with the Dow Jones index declining to 50,687.07.

In earnings, shares of Broadcom Inc. (NASDAQ:AVGO) tanked almost 14% in extended trading on Wednesday, after the company reported disappointing revenues for its fiscal second quarter. CrowdStrike Holdings Inc's (NASDAQ:CRWD) shares declined to close more than 21% lower on the company's lacklustre guidance and the announcement of a 4-for-1 stock.

On the economic data front, the ISM Services PMI rose to 54.5 in May, from 53.6 in the previous month. The figure was higher than market estimates of 53.8 and represented the strongest expansion in the services sector in three months.

Sectors on the S&P 500 closed on a mixed note, with energy, consumer staples and health care stocks recording the biggest gains on Wednesday. However, information technology and financial stocks closed the session lower.

The Dow Jones fell 1.21% to close at 50,687.07 on Wednesday. The S&P 500 lost 0.74% to settle at 7,553.68, while the Nasdaq Composite declined by 0.89% to 26,853.98.

Investors are awaiting earnings results from Lululemon Athletica Inc. (NASDAQ:LULU), Ciena Corp. (NYSE:CIEN),and Docusign Inc. (NASDAQ:DOCU) today.

What Is CNN Business Fear & Greed Index?

At a current reading of 54, the index entered the “Neutral” zone on Wednesday.

The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that greater fear exerts downward pressure on stock prices, while greater greed exerts upward pressure.

The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.