Earnings season got off to a better-than-expected start yesterday, with Alcoa’s (NYSE: AA) third-quarter loss coming in above estimates.
Many investors use the aluminum manufacturer’s earnings as a barometer to measure the health of global manufacturing, but the market has yet to mirror Alcoa’s positive results.
Why? Investors are likely nervous about the continued uncertainly around the globe.
As Thomson Reuters analyst, Jharonne Martis, says, “What is worrisome in corporate America is their exposure on foreign markets. How much they depend on doing business in Europe and China, especially because China is starting to slow down their economy.”
However, once more positive third-quarter earnings come in, investors should eventually change their tune.
According to Michael Woolfolk of BNY Mellon, “I think the Fortune 500 are going to come in better than expected. You will find that there are more companies that beat expectations than miss expectations, in the third quarter.”