NEW YORK ( TheStreet) -- Stock futures were wavering Tuesday ahead of the start of the new earnings season, and amid a downgrade of global growth estimates from the International Monetary Fund.
Meanwhile Spain's bailout plans remained uncertain.
"The monthly meeting of Eurozone finance ministers ended with little fanfare," said Gareth Berry, foreign-exchange strategist at UBS.
"The markets continue to look to Spain to ask for a bail out, though the Ecofin is not the group to apply that pressure (at least, not in public)," added Paul Donavan, a global economist at UBS. "The German government says Spain does not need a bail out. This might be an instance of the German sense of humor; it is hard to tell."Futures for the Dow Jones Industrial Average were up 5 points, or 7.65 points below fair value, at 13,506. Futures for the S&P 500 were up 0.90 points, or 0.37 points above fair value, at 1451. Futures for the Nasdaq were falling 2.50 points, or 5.47 points below fair value, at 2775. The International Monetary Fund said in its latest World Economic Outlook, unveiled in Tokyo ahead of meetings this week of global finance chiefs in the city, that the global economy could grow 3.3% in 2012 and 3.6% in 2013, below its prior forecasts of 3.5% this year and 3.9% next year. "Low growth and uncertainty in advanced economies are affecting emerging market and developing economies through both trade and financial channels, adding to homegrown weaknesses," said IMF Chief Economist Olivier Blanchard. However, prospects could improve if clouds over the euro area and the U.S. "fiscal cliff" are lifted, the report added. The major U.S. stock averages fell Monday with investors ill at ease about the possible outcome of a two-day meeting between European finance ministers and the World Bank's downgrade of China and East Asia's growth prospects. On the U.S. economic front Tuesday, the National Federation of Independent Business' small business optimism index fell to 92.8 in September from 92.9 in August. The FTSE 100 in London was down 0.21% and the DAX in Germany was lower by 0.39% Tuesday. German Chancellor Angela Merkel's travels to Greece for the first time since the debt crisis began. The Nikkei Average in Tokyo finished down 1.06%. The Hang Seng in Hong Kong closed up by 0.54% after a big liquidity injection by China's central bank into the country's money markets. November crude oil futures were up 53 cents at $89.86 a barrel. December gold futures were up 10 cents at $1,776 an ounce. The benchmark 10-year Treasury was rising 15/32, diluting the yield to 1.699%. The dollar was up 0.23%, according to the dollar index. On the corporate front, Alcoa (AA), the first component of the Dow to report each quarter, is expected by analysts after Tuesday's closing bell to post third-quarter earnings at breakeven on a per-share basis. Revenue for the aluminum maker is expected at $5.57 billion. Yum! Brands (YUM), the owner of Pizza Hut, Taco Bell and KFC, is expected by analysts to post quarterly earnings of 97 cents a share on revenue of $3.66 billion. "Today we posit the question 'What's the worst that can happen?' with respect to the upcoming earnings season. The answer, at least when it comes to a representative sample of 25 large cap names, is 'Meh ... Not too bad,'" noted Nicholas Colas, chief market strategist at ConvergEx Group. "We're all used to looking at earnings expectations based on the average of analysts' EPS estimates, but what if the most bearish analyst is right every time this quarter? Such a scenario would result in an average 10.3% average miss to expectations for our universe of market-leading names. Take out a few stocks where the worst-case-scenario is +15% away from the mean, and the 'real' worst case is an even-smaller average 6.7% miss. The dispersion grows considerably on Q4 expectations, but the 'worst case scenario' here still just 11.6% off consensus. Bottom line -- the 'worst case' isn't all that bad." Composite and building materials systems company Owens Corning ( OC ) cut its 2012 earnings forecast amid weakness in its roofing and composites businesses. Edwards Lifesciences (EW), the heart valve maker, provided a weak outlook for the third quarter on Monday, citing the impact of austerity measures in Europe and other factors. The company expects sales of $448 million in the September-ended quarter, below its previous targeted range of between $465 million to $485 million. Wall Street's consensus estimate is for revenue of $476.6 million in the quarter. Power and hand tools supplier Stanley Black & Decker (SWK) reached an agreement to sell its hardware and home-improvement unit to Spectrum Brands ( SPB ) for $1.4 billion in cash. AngioDynamics (ANGO) posted a fiscal first-quarter loss on Monday of 2 cents a share; analysts had expected the medical instruments maker to post earnings of 9 cents a share. AngioDynamics also announced plans to buy Vortex Medical for $15 million. Principal Financial (PFG), the insurance company, announced Monday it agreed to buy Chile's AFP Cuprum, a pension company, for $1.5 billion. Homeopathic and health products company ProPhase Labs ( PRPH ) was offered a sweetened proposal of $1.60 a share in cash from Matrixx Initiatives, which was 14% above the previous offer of $1.40 that was turned down by ProPhase.
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