U.S. corporate profits rose
for a second quarter after five straight declines as consumers
refinanced their home mortgages and bought cars and household
products with new features.
Earnings rose 9.6 percent among the 415 of the Standard &
Poor’s 500 Index companies that had reported third-quarter results
as of yesterday. That compares with a 23 percent decline in the
year-earlier quarter and a 1 percent gain, adjusted for an
accounting change for acquisition expenses, in the second quarter.
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“Growth is going to be very slow and choppy,” said John
Zimmerman, who helps manage $288 billion at Banc of America
Capital Management. “There was a relief rally this quarter, but
we really aren’t in a materially different place than we were three or six months ago.”
The Dow Jones Industrial Average rose almost 11 percent last
month, its largest monthly gain since January 1987.
For the fourth quarter, analysts expect profits to rise 15
percent, according to Thomson First Call, which tracks earnings
estimates. That figure may be reduced as more companies say
earnings will fall short of estimates.
Bloomberg News
