Earnings season kicked off yesterday, with Alcoa as the traditional first reporter. Alcoa beat its earnings estimates, with profits of 11 cents per share as opposed to the Wall Street consensus of 8 cents per share. Nevertheless, its income fell dramatically, from $242 million in the first quarter of 2012 to $149 million this quarter.
We may be in for a lot of that sort of thing. Most of the prognosticators seem to think this is going to be a fairly weak season for earnings growth. S&P Capital IQ foresees them as growing at just 0.6 percent over the first quarter of 2012. And that's one of the more optimistic forecasts: FactSet's projection is that earnings will shrink by 0.6 percent.
The true tale may be told later in the week. Both JP Morgan Chase and Wells Fargo report their earnings on Friday, and those two big banks are considered much more a bellwether than Alcoa is.
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