By Wallace Witkowski, MarketWatch
SAN FRANCISCO (MarketWatch) -- Weakness in Europe and a stronger
dollar are the major concerns for corporate America going into this
earnings season but that may apply more to outlooks than results
for the third quarter.
Stocks are coming off a roller coaster week going into the heart
of earnings season. Reports from heavyweights like Apple Inc.
(AAPL) and 12 Dow components representing the telecom, industrials,
tech, and consumer staples sectors are due.
Dow Jones Industrial Average component earnings this week
Company/Ticker Report Date Estimated EPS Estimated Revenue
IBM Oct. 20 $4.32 $23.38 billion
United Tech Oct. 21 $1.81 $16.16 billion
Coca-Cola Oct. 21 53 cents $12.12 billion
Verizon Oct. 21 90 cents $31.57 billion
McDonalds Oct. 21 $1.38 $7.2 billion
Travelers Oct. 21 $2.26 $6 billion
Boeing Oct. 22 $1.98 $22.97 billion
AT&T Oct. 22 64 cents $33.21 billion
Microsoft Oct. 23 50 cents $22.01 billion
3M Oct. 23 $1.96 $8.23 billion
Caterpillar Oct. 23 $1.33 $13.23 billion
P&G Oct. 24 $1.07 $20.79 billion
Even with a big rally on Friday, stocks still finished lower
last week with the Dow Jones Industrial Average (DJI) and the
S&P 500 Index (SPX) both off 1% and the Nasdaq Composite Index
(RIXF) down 0.4%.
While a rally in the U.S. dollar (DXY) over the third quarter
has been a concern coming into this earnings season, the effects
may play out more in the fourth quarter than the third.
"If dollar strength continues we'll likely see the impact in the
fourth quarter, but the third quarter was solid overall," said
Randy Frederick, managing director of trading and derivatives at
Charles Schwab.
Weakness in Europe was also one of the most cited concerns of
companies in their earnings conference calls so far, according to
John Butters, senior earnings analyst at FactSet.
Schwab's Frederick suggested that it might be wise to focus on
companies that are more dependent on domestic sales. On the
brighter side, Frederick said that the U.S. appears to be
decoupling from Europe now.
Frederick said there's no single catalyst pressuring markets.
While economic data has been soft as of late, the market has done
pretty well in spite of it. He estimates that about half the
pressure on the market has come from challenges in Europe, falling
interest rates, and the spread of the Ebola virus. That pressure
reached a high point this past week.
Investor fear reached levels not seen in three years as the CBOE
Volatility Index (VIX) briefly passed above 30 this past Thursday,
its highest level since November 2011, and stocks saw a massive
selloff.
In addition to more than a third of the Dow 30 reporting this
week, another 110 companies on the S&P 500 report earnings. All
together, about a third of the index's market cap.
Notable S&P 500 earnings this week
Company/Ticker Report Date Estimated EPS Estimated Revenue
IBM Oct. 20 $4.32 $23.38 billion
United Tech Oct. 21 $1.81 $16.16 billion
Coca-Cola Oct. 21 53 cents $12.12 billion
Verizon Oct. 21 90 cents $31.57 billion
McDonalds Oct. 21 $1.38 $7.2 billion
Travelers Oct. 21 $2.26 $6 billion
Boeing Oct. 22 $1.98 $22.97 billion
AT&T Oct. 22 64 cents $33.21 billion
Microsoft Oct. 23 50 cents $22.01 billion
3M Oct. 23 $1.96 $8.23 billion
Caterpillar Oct. 23 $1.33 $13.23 billion
P&G Oct. 24 $1.07 $20.79 billion
More from MarketWatch:
What to expect in Apple's earnings
What to expect in Yahoo's earnings
What to expect in Microsoft earnings
What to expect in McDonald's earnings
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