Outlooks for the fourth quarter - just two weeks old - are so far decidedly more negative than positive. Thomson Reuters data shows 11 negative outlooks so far from Standard & Poor's 500 companies and no positive outlooks.

Third-quarter guidance, meanwhile, at the comparable period showed 6 negative outlooks and no positive.

The market has seen this play out before - companies systematically lower the bar, only to exceed estimates by a fair amount, resulting in "surprises" that bolster stock prices. This hasn't happened yet in this earnings season, but investors are on the lookout for it.

"It's really an issue of whether companies are trying to set the bar lower and give themselves an easier target to beat or whether it really does reflect a substantial risk of a slowing global economy," said Rick Meckler, president of investment firm LibertyView Capital Management in New York.

However, U.S. companies so far are having a tougher time beating analyst expectations in the third quarter, with 59 percent of companies exceeding forecasts, below the 62 percent long-term average, based on Thomson Reuters data. And year-over-year growth is expected to be negative for the first time in three years.

Revenue trends have also been weak: Just 50 percent of companies that have reported have beaten estimates on revenue, compared with the 62 percent average, he said.

Warnings continue to come in for third-quarter reports, helping to drag down earnings estimates for the period. Several of those warnings have come from Kohl's (KSS.N) and other retailers, which do not report results until early November.

"For a lot of companies, particularly the multinationals that rely on global growth, I suppose China and Europe are at the heart of their fears," Meckler said.

Europe was cited more than any other reason for negative forecasts from S&P 500 companies for the third quarter, a Thomson Reuters survey showed, but China is a growing concern.

The slowdown in China's economy is expected to have one of the biggest effects on earnings in the U.S. technology sector, which had been among the earnings leaders. Since July 1, tech has seen a 10.4 percent drop in estimates, second worst only to materials - which is also affected by overseas demand.

Among companies guiding lower for the fourth quarter was software maker Adobe Systems (ADBE.O). It cited a faster-than-expected shift to subscriptions by customers.

Aluminum company Alcoa Inc (AA.N), which did not give a fourth-quarter earnings forecast, lowered its global aluminum consumption outlook to 6 percent growth, from 7 percent previously for 2012, and cited China as the main factor.

With results in from just 34 S&P 500 companies, estimates for earnings show a decline of 2.5 percent from a year ago, down from an October 1 forecast for a 2.1 percent fall.

If the percentage of companies beating earnings expectations stays at 59 percent, it would be the weakest earnings beat rate for any quarter since the fourth quarter of 2008, said Thomson Reuters earnings analyst Greg Harrison.

Estimates for the fourth quarter show S&P 500 earnings growth of 9.6 percent, down slightly from an Oct 1. estimate for growth of 9.9 percent, Thomson Reuters data showed.

Analysts said stocks could be in for more losses if the trend continues. The S&P 500 .SPX is down 0.2 percent since Wednesday, the day after Alcoa reported, and is off 3.1 percent since its September 14 intraday high for the year.

But Mike Jackson, founder of Denver-based investment firm T3 Equity Labs, believes the pessimism that has seeped into the market in recent weeks is overstated.

"Analysts overreact more negatively and lag positively," he said.

He sees S&P 500 industrials and telecommunications as sectors most likely to surprise to the upside on third-quarter earnings, along with energy, which has seen a big slide in earnings estimates.

(Reporting By Caroline Valetkevitch; Editing by Tim Dobbyn)

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