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GDP could cheer Wall St.
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October 31, 2001: 8:50 a.m. ET
The economy contracts in 3Q, but not as much as many feared.
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NEW YORK (CNNfn) - U.S. stocks looked set to rise early Wednesday, following a two-session decline, after data showed that the economy last summer was not as weak as expected.
The nation's growth domestic product fell 0.4 percent in the third quarter, the Commerce Department said. The economy's worst performance since 1991 was nonetheless better than the expectations of economists, who forecast a 1 percent decline.
U.S. stock futures pointed to an early gain.
"This number may be a touch better than expectations," Mickey Levy, chief economist at Bank of America, told CNNfn's Before Hours.
If the contraction continues in the current quarter, the economy will record its first recession in a decade, something economists have predicted for months.
"I think we are in a recession," said Levy, who expects recovery next year.
Consumers and business were already cutting back on spending before the Sept. 11 attacks, which brought the economy to a near halt. Since then, the government has lowered taxes and pledged billions of dollars in spending to prime the economy's pump.
The Dow Jones industrial average stands at 9,121.98 after a 147-point decline, the second triple-digit drop in as many sessions. The Nasdaq composite index, at 1,667.41 after a 32-point drop, is again below its pre-Sept. 11 level. The Standard & Poor's 500 is at 1,059.79 following a more than 18-point slip.
Asian stock markets finished mostly lower Wednesday. Technology stocks led European bourses higher in early trading.
Treasury prices edged lower in early trading, with the 10-year note yield rising to 4.43 percent from about 4.41 percent late Tuesday. The dollar was little changed against the yen and euro. Brent oil futures rose 2 cents to $20.93 a barrel in London.
Qwest Communications (Q: Research, Estimates) lost 8 cents a share in the latest quarter, missing forecasts for profit of 3 cents a share. The communications company earned 14 cents a share in the year-ago period. Qwest stock fell $1 to $15 in before-hours trading Wednesday.
Tommy Hilfiger (TOM: Research, Estimates), the apparel marketer, earned 53 cents per share in its fiscal second quarter, up from 49 cents a share in the year-earlier period. Shares fell 34 cents to $10.56 Tuesday.
Continental Airlines (CAC: Research, Estimates) reported a loss of $1.76 a share, excluding federal aid after the attacks and one-time items, a bit better than Wall Street forecasts for a loss of $2.25 a share. Continental stock lost 55 cents to $16.65 Tuesday.
Alcatel (ALA: Research, Estimates) , Europe's fourth-largest telephone equipment maker, posted a third-quarter loss and announced another round of job cuts. Alcatel stock fell 94 cents to $13.76 Tuesday.
The shrinking third-quarter GDP could presage the nation's first recession in a decade, often defined as two straight quarters of negative growth.
GDP isn't the day's only report. After the market opens, the National Association of Purchasing Management-Chicago releases its index of regional manufacturing conditions. Economists forecast a decline.
Whatever happens to stocks Wednesday, October will have been a good month for stocks. The Dow industrials were up 3.1 percent this month through Tuesday, while the Nasdaq has registered a 11.2 percent gain. 
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