General Electric, another Dow component and the parent of CNBC and CNBC.com, will report its results on Friday. Others on this week's calendar include Costco Wholesale on Wednesday andPepsiCoon Thursday.
The recent upheaval in the financial markets, which marked by a lack of liquidity in the credit markets this summer, is having a predictable impact on the financial services sector, which makes up about 28% of the earnings in the Standard & Poor's 500 Index. That soft spot is skewing the outlook for the nation's largest companies.
"You cannot have a good quarter without the financials," said Howard Silverblatt, senior index analyst at Standard & Poor's.
Thomson Financial is predicting earnings growth of 0.8% in the third quarter before rebounding to double digits in the fourth. However, the forecast could turn negative as financial services analysts are still in the process of lowering their quarterly estimates, according to John Butters, director of earnings research at Thomson Financial.
S&P is even less optimistic, expecting profits to decline about 1.6% in the third quarter before swinging back to a profit of more than 10.8% in the fourth quarter.
But, as in past quarters, the estimates could prove too pessimistic.
"I think the estimate for this quarter...is probably too low," said David Spika, vice president and investment strategist of WHG Funds, in an interview on CNBC's "Power Lunch." "The fear of what was going to happen in the financial sector, I think, caused analysts to ratchet down their estimates too far."
Spika expects to see good earnings out of the energy and technology sectors as well as some of the basic materials companies and others in industries exposed to foreign growth.
"I think we’re going to see earnings surprises to the upside - not double-digit levels - but to the upside, and I think the market’s going to be pleased," Spika said.
Large Losses on Loans
The financial services sector has been rocked by turmoil in the credit markets, and will likely post weak profit. Revenue from mortgages and refinancing has shrunk, hurt by a soft housing market, rising default rates, and a liquidity crunch. Liquidity pressures also caused losses in fixed-income investments and dealt a body blow to merger and acquisition activity.