WALL Street heads into earnings season this week playing a typical game: worrying about results a lot, and then rallying on pleasant surprises.

Analysts have been lowering earnings estimates of late and nervousness about the US economic picture abounds, especially after Friday’s poor June jobs report.

However, profit growth could still be strong in the second quarter – and that could boost stocks. The Standard & Poor’s 500 fell 0.4 per cent in the second quarter, but rallied in recent days on hopes for economic improvement.

Over the last month, analysts have revised downward their earnings estimates for S&P 500 companies, with the mean change in earnings estimates a negative 6.4 percent, according to Thomson Reuters StarMine data.

“I think there’s going to be a lot of anxiety going into it, and I think companies are going to continue what they’ve done for the last few quarters: put out better-than-expected numbers, and guidance should be OK,” said Scott Billeaudeau, of Fifth Third Asset Management, in Minneapolis.

S&P 500 components’ earnings are expected to have increased an average of 7.3 per cent in the second quarter from a year ago, down from first-quarter growth of 18.9 per cent. But the number could jump if most companies beat analysts’ forecasts. Early estimates for first-quarter profit growth were at about 13 per cent.

“The general economic data is suggesting some softness in the overall economy both globally and in the US ... so that drives somewhat more realistic expectations for companies,” said Natalie Trunow, chief investment officer of equities of Calvert Investment Management in Bethesda, Maryland.

This week the Federal Reserve will release minutes of its June 21-22 policy-making meeting. Among the US economic indicators on tap are June retail sales, June inflation readings from the US Producer Price Index and the US Consumer Price Index, industrial production and capacity utilisation for June, and the preliminary July reading on consumer sentiment from the Thomson Reuters/University of Michigan Surveys of Consumers.