Lowered Expectations Drag Down Dow

Earnings season unofficially begins after the markets close today, and traders are pushing stocks lower on concern about the upcoming numbers. Analysts and investors are lowering expectations, and today this has pushed the Dow Jones Industrial Average (INDEX: ^DJI) down 0.7% and the S&P 500 (INDEX: ^GSPC) 0.9% lower as of 3:30 p.m. EDT.

The International Monetary Fund didn't help sentiment when it lowered its growth guidance. It now expects 3.3% economic growth in 2012, rather than 3.5%. It pegs growth for 2013 at 3.6%.

Meanwhile, Alcoa (NYS: AA) , the company that's actually reporting earnings today, is up 1.2%. The company settled a four-year legal battle with Aluminum Bahrain BSC for $85 million and agreed to a long-term sales agreement. This may have some impact on trading today, but the big numbers come out after the close. Analysts expect the company to report revenue of $5.54 billion and breakeven earnings.

Tech companies with a consumer focus are leading the decliners on the Dow today. Intel (NAS: INTC) has fallen 2.7%, and Microsoft (NAS: MSFT) is down 1.7%. Intel said it plans to lay off 7,100 employees from its McAfee unit -- a sign that the acquisition isn't going as well as planned. Intel and Microsoft are both very dependent on global economic growth, particularly in emerging markets, and the IMF's forecast has investors thinking cautiously.

The question for investors is whether or not now is the time to sell these stocks. Intel is trading at 10 times forward earnings, and Microsoft trades at 8.9 times. We've taken a deep dive into both companies in our premium reports to answer the question. Click here to find out about the opportunities awaiting Intel. To find out whether Microsoft is more than a tech dinosaur, click here.

Elsewhere in the market, oil is rising on supply concerns. The commodity is up 3.3% today on fear that the conflict in Syria will spread and disrupt supply. This continues the theme of the day of an overly cautious market as we head into earnings season.

The article Lowered Expectations Drag Down Dow originally appeared on Fool.com.

Fool contributor Travis Hoium manages an account that owns shares of Intel and Microsoft. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.The Motley Fool owns shares of Intel and Microsoft. Motley Fool newsletter services have recommended buying shares of Intel. Motley Fool newsletter services have recommended creating a synthetic covered call position in Microsoft. Motley Fool newsletter services have recommended writing puts on Intel. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

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