The most important item on today’s calendar is the release of the Fed’s June meeting minutes later this afternoon, which will give the market an opportunity to handicap the odds of further Fed support in the coming days. The uncertain domestic economic scene following the recent run of soft economic readings has increased the market’s clamor for more QE, and today’s minutes will likely show that the Fed remains willing to oblige should conditions remain downbeat.

While most expect the Fed to come through with more QE at some stage if the economy remains weak, hardly anyone believes that a new round will materially change the trajectory of economic growth. What could be far more beneficial to the economy at this stage would be decisive resolution of the "fiscal cliff" issue, but that is unlikely to happen in this election year.

As a result, the Fed is the only game in town and they would like to be seen doing "something" even if its utility is questionable. The election may prompt the Fed to take earlier action rather than wait for more evidence of slowdown.

The global economic growth question that had been swirling around for a while seem to have finally caught on with corporate earnings as well. The current earnings pre-announcement season has provided us with plenty of evidence that ongoing synchronized slowdown all over the world is weighing on corporate earnings. We will know more in the coming days as the reporting cycle accelerates, but the signs at this stage don’t look very promising.

Bellwether companies in a range of industries like FedEx ( FDX - Analyst Report ) - Analyst Report), Procter & Gamble ( PG - Analyst Report ) - Analyst Report), Nike ( NKE - Analyst Report ) - Analyst Report) and Cummins ( CMI - Analyst Report ) - Analyst Report) have cited worldwide slowdown in demand. Earnings expectations for the second quarter and full-year 2012 had been trending down even before these pre-announcements, but we hadn’t seen many downward adjustments to next year’s estimates.

It is very likely that we will see a material acceleration in negative estimate revisions for 2013 as the second quarter reporting season progresses. This means that the market may have to contend with negative earnings momentum in addition to all the other macro questions that have been weighing on it for a while now.

(This article was originally published as Ahead of Wall Street - July 11, 2012.)