U.S. Markets May Follow Asian and European Markets Lower

The U.S. markets appear to be set to follow Asian and European markets lower.

Standard & Poor’s 500 Index could end a three-day rally, even as companies reported better-than-expected earnings in the second quarter. According to Bloomberg, 78 of 110 companies in the S&P 500 that have reported results so far have exceeded analyst estimates. Earnings of 29 companies fell short of estimates.

The focus of investors will be on more corporate earnings, as well as the eurozone meeting on the Spanish bank bailout. General Electric (NYSE: GE) and Schlumberger (NYSE: SLB) beat Q2 earnings estimates in this morning’s reports. Xerox (NYSE: XRX) is on tap to share its results too.

European investors appear to be taking a breather. Shares of Vodafone Group (NASDAQ: VOD), Europe’s largest mobile-phone company, retreated after it posted disappointing quarterly service. And European finance ministers continue to discuss the terms for the Spanish bank bailout.

At last check the FTSE 100 and the DAX were both down about 0.5% and the CAC 40 had retreated about 0.8%.

Asian stocks ended mostly lower Friday. Japanese financials and utilities dragged on the Tokyo market, but strong gains in telecom shares helped lift Hong Kong.

Friday, Japan’s Nikkei closed 1.4% lower. Hong Kong’s Hang Seng Index HSI ended 0.4% higher. For the week, the Hang Seng rose 2.9%, the Shanghai Composite slipped 0.8%, and the Nikkei ended 0.6% lower.