Stocks drift after Alcoa, Yum results

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Stocks are falling for a third day as indexes drift near long-term highs with no strong catalysts this week.

S&P 500 futures are fractionally higher, following losses of less than half a percent in Europe. Declines were more dramatic in Asia, where diplomatic tensions between Japan and China continue to weigh on confidence.

Early last month, the S&P 500 broke out above its trading range from 2008 and has been consolidating since then. The move followed an unexpected rally since June after a steady drumbeat of overseas worries failed to sink share prices. It's been drifting in range since that breakout, supported by assurances from central bankers, and now investors are preparing for a weak earnings season thanks to slowing global economy.

They got a first taste of those results last night when aluminum giant Alcoa reported better-than-expected profit and revenue. Management, however, said it now expects global demand to grow by just 6 percent versus its earlier 7 percent estimate. AA initially rose slightly but is now fractionally lower.

Volatility is also very low in the commodities, but the tone is only mildly negative. Crude oil, copper, and silver are fractionally lower, but natural gas and gasoline are both higher by half a percent. Most agricultural foodstuffs are down modestly. The biggest decline is in platinum, down more than 1 percent, on signs that lingering unrest in South Africa could be nearing an end.

Trading in the foreign-exchange market is more positive. Currencies associated with risk appetite, namely the Australian and Canadian dollars, are higher while the yen is lower. The euro is little-changed and continues to consolidate in a range following a big rally in August and September.

Elsewhere in company-specific news, metals producer Ferro is down by 10 percent after cutting guidance, while fast-food giant Yum Brands rose 4 percent after a strong earnings report.

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