US futures mixed ahead of US earnings season
US stock futures mixed as ominous economic predictions dampen opening of US earnings season
FILE- In this Oct. 5, 2012, file photo, Jonathan Corpina, left, works with fellow traders on the floor of the New York Stock Exchange. World stock markets mostly declined Tuesday, Oct. 9, 2012, against a backdrop of worries about global economic growth and Europe's debt crisis.(AP Photo/Richard Drew, File)
·Associated PressNEW YORK (AP) -- Stock futures were mixed Tuesday with a new outlook on the global economic landscape y providing markets with fewer reasons to overlook what is likely to be a weak quarter for many of the biggest U.S. corporations.
Markets have been buoyed for months by expectations that the U.S. Federal Reserve would step in if was any sign that the U.S. economic recovery was flaming out. However, economists have continually lowered expectations for the year ahead, and the IMF report Tuesday only heightened pessimism.
Dow Jones industrial futures rose 18 points to 13,519. The broader S&P futures rose 2.4 points to 1,452.20. Nasdaq futures gave up 0.25 points to 2,777.25.
The International Monetary Fund said Tuesday that the global economy is weakening and that the downturn afflicting developed nations has begun to spread to once fast-growing, developing countries.
The IMF forecasts that the world economy will expand 3.3 percent this year, down from the estimate of 3.5 percent growth it issued in July. Its forecast for growth in 2013 is 3.6 percent, down from 3.9 percent three months ago and 4.1 percent in April.
Also on Tuesday, a survey released by the National Federation of Independent Business shows that owners became increasingly pessimistic during September due to the employment picture and weak sales. Still, the number of owners who expect business conditions to improve in six months gained 4 percentage points and those believing it's a good time to expand rose 3 percentage points.
The global slowdown threatens a weak recovery in the U.S., particularly for global companies like those reporting Tuesday; Alcoa and Yum Brands, the owner of the Taco Bell, Pizza Hut and KFC restaurant chains.
Wall Street expects Alcoa to break even, but had been predicting profits of 12 cents per share from the aluminum maker as recently as July.
The global slowdown had already been reflected at Yum Brands in the second quarter. Yum had gorged on super-sized profit growth from China, but that ended in the second quarter. Operating profit fell 4 percent, when adjusted for currency fluctuations, in the company's most important overseas market.
It's a different story in the U.S., where operating profit was up 26 in the second quarter as all three of its chains had stronger sales, led by Taco Bell.
Analysts expect to Yum Brands to post earnings of 97 cents per share in the third quarter.
Two big banks, JPMorgan Chase and Wells Fargo, post earnings Friday.
