Alcoa Kicks Off Earnings Season
DAVID GREENE, HOST:
Alcoa, the aluminum maker, says it lost more money than expected during the second quarter of this year. The company said restructuring costs are to blame. Alcoa's announcement yesterday kicked off the latest earnings season, when companies tell us how much money they made in April, May and June.
NPR's Jim Zarroli has more.
JIM ZARROLI, BYLINE: The second quarter of 2013 was something of a lackluster time for the U.S. economy. Stock prices hit new highs, at least until June, when interest rates spiked. But overall growth was plodding and corporate profits probably will reflect that.
David Kelly is chief global strategist at JPMorgan Funds.
DAVID KELLY: The economy is still having to deal with a lot of fiscal drag, big tax increases at the start of the year, so overall, the economy is growing slowly. It's a little bit of a tough environment in which to see profit growth.
ZARROLI: Kelly says profits probably grew by just three to four percent during the quarter compared to a year earlier. He says growth was even slower overseas and that will affect companies that make a lot of their money abroad.
KELLY: Energy, I think, should be down year over year, industrial companies, those that are more dependent on the global economy should be lagging behind.
ZARROLI: And Kelly says profits made overseas will appear even smaller because the dollar has been strong. In contrast, he says companies that make their money domestically, like health care and consumer companies, probably fared better. Because of the upturn in housing, companies that are involved in the housing market, such as mortgage banks, probably also had a good quarter.
Jim Zarroli, NPR News.
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