Stocks: The Lost Earnings Season

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For most other sectors, the focus is not on quarterly financial results, but on what executives say in conference calls after the numbers are released. Chief executives and chief financial officers are being quizzed on what they expect for the fourth quarter and especially from 2009. "People are really mostly focused on next year," says John Thornton, portfolio manager at the Stephens Small Cap growth and Mid Cap Growth Funds.

Credit Crunch Sinking In

However, so far execs aren't giving investors what they want. "They're vague," Bacarella says. They're saying, "'It's very hard for us to forecast,'" he adds. "They themselves are not sure."

Companies are only beginning to feel the impact of the credit crunch and a slowing U.S. and global economy. "Management teams are going to be pretty cautious and pretty hazy," Thornton says.

According to Thomson Reuters, industry analysts currently expect 2009 earnings for the S&P 500 to rise almost 20% from 2008 levels. For Chalupnik, this is "wildly optimistic." He expects earnings to fall next year as the U.S. slips into recession. Many other investors seem to agree: The S&P 500 is down more than 20% in the past month.

Energy Outfits Feeling the Pain

Financial firms aren't the only area of concern for equity investors. Earnings at energy and material firms are expected to suffer from the fall in commodity prices. "People are very nervous about energy fundamentals," Thornton says. On the other hand, a firm like DuPont (DD), due to report earnings on Oct. 21, could benefit from lower oil prices because its costs for raw materials will fall but could suffer from a U.S. recession.

Tech firm executives should be worried that a U.S. recession slows spending on technology by corporations. Apple (APPL) is due to report earnings on Oct. 21, while Microsoft (MSFT) reports on Oct. 23.

Expectations for consumer firms "have dropped off a cliff," Chalupnik says. September U.S. retail sales fell 1.2%, twice the decline economists were expecting. Earnings are due from Coach (COH) on Oct. 21, from Amazon.com (AMZN) on Oct. 22, and from RadioShack Corporation (RSH) on Oct. 23.

Eyeing Export Sales

It's not just the U.S. economy and American consumers that are raising concerns. Investors are scrutinizing earnings releases for clues as to the direction of the world economy.

For years, industrial firms like Caterpillar (CAT), which reports Oct. 21, and Ingersoll Rand (IR), due Oct. 24, have profited from brisk product sales abroad. "People are going to be looking for signs of how much international is really slowing," Thornton says.

Everywhere investors turn, they seem to find big uncertainties. "It's going to be rough for the next two quarters," says Peter Cardillo, chief market economist at Avalon Partners. "The economy is under pressure."

How are profits being affected by the credit crunch, falling commodity prices, weak business and consumer spending, and a slowing world economy? Third-quarter results may only provide the faintest of clues. But those clues will still be seized upon by investors desperate for answers.

Steverman is a reporter for BusinessWeek's Investing channel.