As if the past week weren't fun enough, we've now got fourth-quarter earnings to look forward to.Five companies in the S&P 500 (SPX) will report earnings this week, highlighted by Alcoa ( AA) on Tuesday, but then all hell will break lose the week starting Jan. 14 as one penitent after another steps up into Wall Street's public confession booth. At the moment, according to Thomson Financial, the estimated aggregate growth rate for the S&P 500 companies in the fourth quarter of last year is at a stunning -9.5%. If there's one reason why the market has tanked recently, it is this: On Oct. 1, the estimated growth rate for the fourth quarter was fantasized at +11.5%. Unless a miracle happens -- and to be honest, I'd be short the Miracle Index, if there were one -- these will be the first back-to-back quarters of negative earnings growth for the S&P since the fourth quarter of 2001 and the first quarter of 2002. Of course, most of the downward pressure on earnings has come from financial stocks. Thomson reports that estimates for diversified financial companies suggest their earnings will be down by $14.3 billion, investment banks and brokerages will lose $12.9 billion and mortgage lenders will be down $6.3 billion.
- Among Internet stocks, Google (GOOG) did well with a 51% advance, but eBay (EBAY) was only up 10%, Yahoo! (YHOO) was down 9%, and Akamai Technologies (AKAM) was down 33.5%.
- Among semiconductor stocks, Intel (INTC) did well, but most of its largest peers did poorly, including Broadcom (BRCM), down 19%; Marvell Technology (MRVL), down 27%; and Micron Technology (MU) down 48%.
- Among wireless stocks, Research In Motion (RIMM) and Nokia (NOK) did well, up 168% and 90%, respectively, but most other peers did very poorly, including Motorola (MOT), down 21%; Ericsson (ERIC), down 42%; and Palm (PALM), down 54%.
- Among storage stocks, EMC (EMC) did well, rising 35%, but Network Appliance (NTAP) fell 35% and SanDisk (SNDK) fell 22%.
- Among brokerage and financial stocks, Charles Schwab (SCHW) and optionsXpress (OXPS) did well, gaining 30% and 44% respectively, but virtually every one of their peers was down, including Bear Stearns (BSC), off 46%; Merrill Lynch (MER), down 43%; and E*Trade (ETFC), down 84%.
- Among restaurants, Chipotle Mexican Grill (CMG) performed well, gaining 158%, but most peers were crushed, including Starbucks (SBUX) (SBUX), off 42%; Ruth's Chris Steakhouse (RUTH), down 51%, Darden Restaurants (DRI), losing 30%; and Panera (PNRA), falling 36%.