NEW YORK (CNNmoney) - Hundreds of companies release third-quarter results in the days ahead. But a question looms: Will Wall Street notice?
Investors in recent days focused less on profits and more on anthrax, which appeared on Capitol Hill and at many of the nation's biggest media companies. Stocks fell last week for the first time in a month.
That trend may continue, even as more than 160 Standard & Poor's 500 companies prepare to release financial results by Friday.
"Headlines have been keeping the markets emotionally tapped," Joe Cangemi, trader at Francis P. Maglio, told CNNfn's Market Call.
Those headlines about anthrax exposure worried investors unsure about how much a fearful public may cut spending.
The Dow Jones industrial average fell 1.6 percent last week to 9,204.11, while the Nasdaq composite index lost 1.9 percent during the last five sessions, falling to 1,671.31. Declining 1.7 percent on the week, the Standard & Poor's 500 index finished at 1,073.48.
While the major indexes have fallen since the Sept 11 terrorist attacks, they remain well above their lows of the year, hit Sept. 21. They're also higher since the United States began striking Afghanistan targets in retaliation.
The Dow stands 12 percent above its 2001 low, while the Nasdaq is 17 percent above the year's worst levels.
Still, Chuck Carlson, CEO of Horizon Investment Services, expects declines in the weeks ahead. With companies offering little clarity about business conditions, Carlson is suspicious that the market's three-week rally that followed Sept. 21 can continue in the weeks ahead.
"Rallies within bear markets tend to be very violent and very brief," he said.
Most have. Nine of the Nasdaq's ten biggest one-day gains on record have occurred since April, 2000, a period when the overall index has tumbled in value.
Still, the government after Sept. 11 slashed interest rates and pledged billions of dollars to New York City and ailing industries, moves that could speed an economic recovery.
"The silver lining is that may have compressed the pain," said Carlson, who expects stock to rise next year.
When it's all over, profits in the third quarter are expected to have fallen 22.4 percent. Looking ahead, analysts surveyed by First Call forecast another 13.9 percent drop in the current quarter and a 1.9 percent decline during the first three months of 2002.
Next year looks better, with earnings expected to gain 17 percent.
Until then, this week's results don't look good. AT&T's (T: Research, Estimates) profit is expected to fall 89 percent, Honeywell (HON: Research, Estimates) is forecasts to post a 40 percent decline in earnings, and Eastman Kodak (EK: Research, Estimates) is expected to see a 62 percent profit drop.
Alan Greenspan, the Federal Reserve chairman, will speak in public three times this week. But Steven Wood, economist at FinancialOxygen.com, expects no hints from the Fed chief on interest rates, which have been cut nine times this year.
On Wednesday, the Fed releases its periodic assessment of the economy, or beige book. The survey covers the post-Sept. 11 attack period.
"We are looking for a very dismal report," Wood said.
Monday brings the index of leading economic indicators, designed to forecast the economy six months in advance. Economists surveyed by Briefing.com expect the LEI to fall 0.5 percent in September.
The Federal Reserve's assessment of the economy, or beige book, comes Wednesday.
Thursday is the big session for economic indicators. In addition to jobless claims, Thursday brings the employment cost index for the third quarter, which is expected to rise 0.9 percent.
September orders for durable goods, due Thursday, are expected to show a decline of 1 percent. Existing homes sales are forecast to have fallen to an annual rate of 5.20 million units in September.
New home sales Friday are also expected to decline last month, to an annual rate of 852,000.
But many economists see this year's gloomy numbers as a prelude to recovery.
"I think we are looking for a pretty good prospect for a rebound next year," said Jim Glassman, senior U.S. economist at J.P. Morgan Chase. 
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