US markets are set to open little changed, with investors keeping half an eye out on the Ecofin meeting of European finance ministers in Luxembourg.

The International Monetary Fund (IMF) has cut global economic growth forecasts for this year and next because "prospects have deteriorated further and risks increased". The IMF said: "The recovery has suffered new setbacks, and uncertainty weighs heavily on the outlook. Downside risks have increased and are considerable."

According to its "World Economic Outlook", the IMF now expects the world economy to grow 3.3% in 2012 compared to the prior 3.5% July estimate and just 3.6% in 2013, down from the previous 3.9% forecast. Forecasts for the Eurozone, UK and emerging markets were all cut.

"The estimates appear to assume that the US will avoid the fiscal cliff and the eurozone will improve next year, both of which seem a bit far-fetched at the moment," said analyst Craig Erlam from spread betting firm Alpari.

"If you look at growth estimates over the past few years, the outlook for the year ahead has always been far too optimistic and eventually subject to a downward revision. Conditions in the US and the Eurozone are likely to deteriorate before they improve making these estimates very ambitious," he said.

Stateside, confidence among small businesses eased off in September, according to the results of a survey by the National Federation of Business.

The Federation's optimism index retreated to 92.8 from 92.9 in August, the fourth time in the last five months that the index has moved lower.

When the bell sounds on Wall Street for the start of open outcry trading, computer chip colossus Intel could be in for a mark-down after Sanford C. Bernstein downgraded the shares.

In contrast, investors could tune into RadioShack after BofA Merrill Lynch upgraded the consumer electronics retailer after the shares had taken a tumble recently.

Later on, after the bell sounds to close the trading session, aluminium firm Alcoa will kick off the third quarter results season when it releases its results. Analysts are expecting earnings per share on or around zero on sales of $5.6bn.

Investors will be anxious to know whether the group can continue to surprise the market with its positive results of late. Alcoa went from posting a €1.15bn loss in 2009 to a €254m profit in 2010 and a €611m profit in 2011.

What has stood out about Alcoa is that its stock price has not kept in line with the positive results. As such, analysts at Morningstar have a "buy" rating with a price target of $19, which implies more than a 100% revaluation.

KFC and Pizza Hut owner Yum Brands is also set to serve up figures after the close of trading. The market is expecting earnings per share of $0.97 on sales of $3.7bn.

Spread betting quotes suggest the S&P 500 will open a couple of points firmer while the Dow Jones 30 is set to start barely changed.


JH

Related share prices