NEW YORK -
Stock index futures fell on Tuesday on concerns the slow global economy will continue to dent corporate revenues, with a trio of Dow components appearing to confirm investor worries.
United Technologies Corp
Fellow Dow component DuPont
"It was ever so modest and ever so subtle but there was a shift to the markets really starting to trade on U.S. economic and U.S. company fundamentals and the market didn't seem to care much about what central banks were doing or what was going on in Europe," said Keith Bliss, senior vice-president at Cuttone & Co in New York.
"Then all of a sudden - wham - we get weaker earnings this quarter and it refocuses everybody's attention on the global economy."
Adding to the global economic concerns was a fall in Spanish bond prices after Moody's downgraded five of the country's regions including economically important but deeply indebted Catalonia.
S&P 500 futures fell 16.1 points and were well below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures dropped 112 points, and Nasdaq 100 futures declined 25 points.
According to Thomson Reuters data, 33 S&P 500 companies are scheduled to post earnings on Tuesday. Of the 123 S&P 500 <.SPX> companies that have reported earnings through Monday morning, 60.2 percent have topped analysts' expectations, shy of the 62 percent average since 1994 and below the 67 percent average over the past four quarters.
Earnings are expected to fall 2.4 percent in the third quarter from a year ago. Even more disconcerting to investors, top-line expectations have been more discouraging, with 61 percent of companies having missed revenue expectations.
The U.S. Federal Reserve's policy committee is also set to begin the first day of a two-day meeting on interest rate policy on Tuesday. The Federal Open Market Committee is likely to hold off from taking fresh steps at the meeting, opting to review the impact of the significant action it took last month and keep a low profile in its last gathering before the November 6 general election.
European stocks fell broadly as third quarter results presented a mixed picture, hitting a one-week low that analysts said might encourage some investors back into the market. <.EU>
Asian shares were lackluster with the corporate reporting season getting underway in the region, as investors stayed cautious after global shares faltered overnight on weak earnings reports and outlooks.
(Reporting by Chuck Mikolajczak; Editing by Chizu Nomiyama)