Third quarter U.S. corporate earnings are expected to show a lower increase next week, weighed down by consumer and financial sectors, Reuters Estimates said on Monday.
The Reuters Group Plc unit, which analyses earnings and forecasts, said it expected third quarter earnings to rise 1.8 percent, compared with 2.7 percent last week and 2.5 percent when the third quarter started on July 1.
The forecast, which combines results reported to date and estimates for companies not yet reported, comes amid growing concerns over a slowdown in corporate earnings. Rising fears about higher energy prices and a housing slowdown have stoked worries that the U.S. may enter a recession, possibly next year.
Nearly a third of the S&P 500 components will report their quarterly results this week. Of the 131 companies that have already reported, more than 25 percent have missed Wall Street's profit targets -- more than twice the level of earnings misses as the same time last year, Reuters Estimates said.
Healthcare and technology sectors are expected to show the largest year-on-year earnings gains, at 14 percent and 12 percent respectively, Reuters Estimates said.
But cyclical consumer goods and services and the financial sector are expected to show the last favorable earnings comparisons, with a 17 percent and 14 percent decline respectively, the group said.
So far in October, U.S. public companies have issued 144 positive forward-looking statements but 226 negative statements, it said.
(With reporting by Jennifer Coogan in New York)