Most Stocks Down Ahead Of Earnings Reports

by Darren

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Stocks cooled off today as investors awaited news of earnings. Columbus day had its’ effect as the bond market was closed so investors didn’t have their normal guidance.

Earnings are expected to reflect the difficulty some companies have faced — particularly in the financial and housing sectors — following upheaval in the credit markets amid overly leveraged debt and defaults in subprime mortgages. The reports will also give insight into the fourth quarter, which market participants predict will bring more robust growth.

“There’s room for a rally if third-quarter earnings come in stronger than expected, but they do want to see that the fourth quarter is going to be strong as well,” said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research.

The reason everyone is so worried about earnings is they could be hurting for certain companies, based on economic data that’s been coming out lately. Some sectors are clearly under water, and many more could join them if consumer pessimism continues. Look for tomorrow to be a more telling day.

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