US close: Stocks fall ahead of Q3 earnings season

By Benjamin Chiou

Date: Monday 08 Oct 2012

US stocks finished with moderate losses on Monday ahead of the start of the third-quarter earnings season as investors fretted about how a subdued global economy will affect corporate profits.

According to estimates from S&P Capital IQ, analysts expect an average 1.3% decline in corporate earnings this quarter.

Trading was said to be on the light side today as the US bond market was closed for Columbus Day.

The World Bank has cut its 2012 growth estimate for China from 8.2% to 7.7%, saying that the economy has been hit by weak export demand and investment growth.

"In order to get the global economy moving again, the world needs countries like China to remain strong so news such as this is a bit of a reality check for investors. We may be seeing indices hitting new highs but the overall economy paints a very different picture," said analyst Craig Erlam from Alpari.

"This will become more apparent when companies publish their third quarter earnings starting tomorrow with Alcoa. I expect we’ll see stocks paring some of their recent gains over the next month or so, with investors fleeing risky assets and looking back towards the traditional safe havens," he said.

In the Eurozone, the region's finance and economic ministers met in Luxembourg today to discuss the euro area's top issues with Madrid and Athens at the top of the agenda.

European Central Bank (ECB) governing council member Jorg Asmussen was cited over the weekend as saying that Greece cannot be given more time by the ECB to meet its commitments as that would amount to state financing. Meanwhile, German Finance Minister Wolfgang Schauble has reiterated that Spain does not need a bailout.

All eyes on Alcoa

Aluminium group Alcoa finished the day slightly higher ahead of its results tomorrow; the firm's quarterly results traditionally mark the start of earnings season in the US.

Marathon Petroleum gained after agreeing with BP to buy the British oil firm's 475,000-barrels-per-day refinery and associated assets in Texas for $2.5bn.

Shares in online video-streaming group Netflix surged today after Morgan Stanley upgraded its rating on the stock from 'equal weight ' to 'overweight'.

Car-maker General Motors was in the red after revealing that Chinese sales in September grew at the slowest rate in eight months. Deliveries of GM cars and mini-vans in the country rose 1.7% in September.

S&P 500 - Risers
Netflix Inc. (NFLX) $73.52 +10.46%
Carmax Inc. (KMX) $31.86 +9.15%
Cliffs Natural Resources Inc. (CLF) $40.58 +5.79%
Marathon Petroleum Corporation (MPC) $57.92 +5.56%
Eli Lilly and Company (LLY) $50.78 +5.29%
Sears Holdings Corp. (SHLD) $58.58 +3.17%
Alpha Natural Res (ANR) $6.78 +3.04%
AutoNation Inc. (AN) $47.93 +3.01%
United States Steel Corp. (X) $20.37 +2.72%
Lexmark International Inc. (LXK) $22.10 +2.55%

S&P 500 - Fallers
JDS Uniphase Corp. (JDSU) $10.88 -4.23%
LSI Corporation (LSI) $6.83 -3.80%
Jabil Circuit Inc. (JBL) $17.39 -3.66%
Eastman Chemical Co. (EMN) $57.00 -3.60%
PulteGroup Inc. (PHM) $16.09 -3.25%
Tesoro Corp. (TSO) $41.90 -3.10%
Masco Corp. (MAS) $15.57 -2.50%
Alexion Pharmaceuticals Inc. (ALXN) $115.24 -2.46%
Sherwin-Williams Co. (SHW) $152.23 -2.22%
D. R. Horton Inc. (DHI) $21.17 -2.22%

Dow Jones I.A - Risers
McDonald's Corp. (MCD) $91.54 +0.59%
American Express Co. (AXP) $58.82 +0.44%
3M Co. (MMM) $95.37 +0.43%
Alcoa Inc. (AA) $9.12 +0.33%
Cisco Systems Inc. (CSCO) $18.90 +0.21%
Wal-Mart Stores Inc. (WMT) $75.25 +0.16%
Exxon Mobil Corp. (XOM) $92.68 +0.14%
Merck & Co. Inc. (MRK) $46.34 +0.13%
Chevron Corp. (CVX) $117.62 +0.10%
Caterpillar Inc. (CAT) $85.44 +0.01%

Dow Jones I.A - Fallers
Home Depot Inc. (HD) $61.88 -2.09%
Hewlett-Packard Co. (HPQ) $14.46 -1.83%
Walt Disney Co. (DIS) $52.33 -1.21%
Verizon Communications Inc. (VZ) $46.57 -1.02%
Mondelez International Inc. (MDLZ) $27.55 -0.93%
General Electric Co. (GE) $22.92 -0.87%
Procter & Gamble Co. (PG) $69.10 -0.76%
Intel Corp. (INTC) $22.51 -0.75%
AT&T Inc. (T) $37.66 -0.53%
Pfizer Inc. (PFE) $25.40 -0.47%

Nasdaq 100 - Risers
Netflix Inc. (NFLX) $73.52 +10.46%
Sears Holdings Corp. (SHLD) $58.58 +3.17%
Green Mountain Coffee Roasters Inc. (GMCR) $22.53 +1.83%
Bed Bath & Beyond Inc. (BBBY) $62.54 +1.53%
Dell Inc. (DELL) $9.80 +1.45%
Viacom Inc. Class B (VIAB) $56.64 +1.31%
Staples Inc. (SPLS) $11.70 +0.60%
Fiserv Inc. (FISV) $74.63 +0.57%
Gilead Sciences Inc. (GILD) $69.81 +0.55%
Akamai Technologies Inc. (AKAM) $39.60 +0.48%

Nasdaq 100 - Fallers
Alexion Pharmaceuticals Inc. (ALXN) $115.24 -2.46%
Apple Inc. (AAPL) $638.17 -2.21%
QUALCOMM Inc. (QCOM) $61.40 -1.98%
Autodesk Inc. (ADSK) $32.45 -1.96%
Infosys Technologies Ltd. (INFY) $47.89 -1.76%
VeriSign Inc. (VRSN) $48.39 -1.67%
Dollar Tree Stores Inc. (DLTR) $47.27 -1.66%
eBay Inc. (EBAY) $47.92 -1.66%
Avago Technologies Ltd. (AVGO) $33.88 -1.63%
Vertex Pharmaceuticals Inc. (VRTX) $58.49 -1.57%

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