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Market Preview: The Trend Turns Ugly

The firm trimmed its expectations for the fourth quarter slightly but said it expects the overall impact of Hurricane Sandy to be basically immaterial, amounting to an earnings hit of 2 cents a share at the most.

"We expect FL to benefit from the post storm replenishment as was the case with Katrina," Sterne Agee said. "FL has said that as of 11-5-12, almost all of their stores are up and running and does not expect the storm to have a significant bearing on the quarter or the year."

The firm is optimistic about next year as well.

"Our checks from numerous retailers indicate that the athletic cycle will remain strong well through 2013," Sterne Agee said. "We believe that there is still low hanging fruit for continued margin expansion over time, including the increased penetration of apparel (from 24% to 30% by FY16), increased penetration in ecommerce (from 5% to 10% by banner), improved systems, and store openings in Europe."

Check out TheStreet's quote page for Foot Locker for year-to-date share performance, analyst ratings, earnings estimates and much more. Other companies reporting on Friday include AnnTaylor Stores (ANN), Casual Male Retail Group (CMRG), Cyberonics (CYBX), Hibbett Sports (HIBB), and J.M. Smucker (SJM).

Friday's economic calendar includes data on net long-term Treasury International Capital flows for September at 9 a.m. ET; industrial production for October at 9:15 a.m. ET; and capacity utilization for October at 9:15 a.m. ET.

And finally, Dell (DELL - Get Report) was losing ground in late trades after the PC maker came up short in its latest quarter and gave a lackluster outlook.

The Round Rock, Texas-based company posted a non-GAAP profit of $679 million, or 39 cents a share, on revenue of $13.72 billion for the third quarter, below the average estimate of analysts polled by Thomson Reuters for earnings of 40 cents a share on revenue of $13.89 billion.

Dell said it expects a "challenging macro-economic environment" to continue into the fourth quarter and forecast sequential revenue growth of 2%-5% for the January-ending period, implying revenue range of $13.99 billion to $14.41 billion. The current consensus view is for revenue of $14.48 billion in the quarter. For the full year, Dell stuck with its forecast for non-GAAP earnings of at least $1.70 a share, below the analysts' estimate of $1.73 a share.

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