S&P 500 Composite Q3 Earnings Seen Down 15%

With 88% of companies in the Standard & Poor's 500 Index having reported, composite third-quarter results are expected to fall 15% from a year earlier, according to Thomson Reuters, though earnings have come in better than anticipated.

Last week, the forecast was for an 18% decline; the percentage shrank on better-than-expected results from Ford Motor Co. (F), among others.

The composite is calculated from actual results as well as estimates for companies that haven't yet reported.

Of the 440 companies in the S&P 500 that have posted results, 80% reported earnings above analysts' expectations, 6% matched and 14% missed estimates. In a typical quarter, 61% of companies beat estimates, 18% match and 21% miss. The highest percentage of companies reporting earnings above expectations for a quarter is 73%, in both the second quarter of 2009 and first quarter of 2004.

Altogether, companies are reporting earnings 15% above estimates, above the highest-ever surprise factor of 13% recorded in the second quarter.

The financial sector is reporting both the highest surprise factor and the highest earnings growth, more than double a year earlier, for the latest quarter. The consumer-discretionary sector has seen earnings climb 45%. Health-care, consumer-staples and utilities earnings are up a fraction.

Sectors with the largest earnings declines are energy, down 62%; materials, which includes chemicals and steel, off 48%; and industrial, down 41%.

So far, 44 companies have predicted fourth-quarter results below Wall Street expectations, while 36 have predicted results above analysts' estimates.

Next week, two components of the Dow Jones Industrial Average--Walt Disney Co. (DIS) and Wal-Mart Stores Inc. (WMT)--are among the 18 S&P 500 companies that will report.

-By Kathy Shwiff, Dow Jones Newswires; 212-416-2357; Kathy.Shwiff@dowjones.com

(END) Dow Jones Newswires

11-06-09 1638ET