The United States markets have arrived on the most awaited fourth quarter earnings season. But, as the market is quite on a declining state, this earnings season is also not showing any silver lining after the dark clouds. The projections are showing that traders have to keep their expectation low for the fourth earning season too.

Since October, the stock market has experienced a number of skews in the graph of earnings. The expectations are running low and any small positive surprises would make all the major indices in the United States to jump and touch new highs. To come to the point about why the market is showing such low earnings trend, the market analysts are saying that the election, hurricane sandy can be considered as the reason for it.

Also they are saying that serials of warnings on the news headlines can also be considered as reason, for which investors are being scared to invest their money in the markets right now. Almost all the top companies, who were in the leading position is experiencing the bitterness of this discouraging acts showed by the investors in the stock market.

When we look at the fact set of S & P 500, we will see that since the start of October, the market has experienced 70% drop on its growth estimate. After the approval of the Fiscal deal, markets rose and rallied hard to touch their important resistance points. Now, the markets and the investors are focusing on the results season which is going to kick off from a few days from now, with Alcoa reporting the first metal bellwether earnings. Most of the analysts are expecting a weak quarter.

David Lutz, head of ETF trading at Stifle Nicolas, said in his review of market that, \”A lot of what the market will be looking at is for projections going forward, so much skew in these earnings will make discerning the winners and losers all the more difficult. It will be interesting to see if we follow the pattern of the past two earnings seasons; sell the news. Another thing that\’s going to be on investors\’ minds is what the running commentary is.\”

At this point, the fact set of leading companies are in a position where, Bank of America has announced its $10 billion settlement on mortgage claims with Fannie Mae. After the foreclosure abuses in the trade of the group of ten leaders, city bank and JPMorgan Chase have reached at a settlement of 8.5 billion. Sectors like energy and utilities, always assumed to have high growth points. But they were also on the target of the hit on Monday.

Companies like Yahoo and Apple have slipped due to muted growth anticipation in their profit and loss reports. The reaction is also on the currency rates where the US dollar currency rates have fell against the rate of Euros. Only companies like Amazon, Morgan Stanley with Time Warner’s Bros Company are showing signs of good upward momentum in their 4th quarter earnings.

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Category: Finances
Keywords: Dow Jones, Samsung, Profit, Earnings, South Korea, Netflix, Low expectations, Earnings