The earnings outlook is still far from pretty, but Wall Street's expectations have been ground down so much that not-so-bad is actually starting to look good.

Analysts have been relentlessly cutting their earnings forecasts for months as the realization dawned on them that slowing economic growth would crimp corporate profits, even in the supposedly economy-immune high-tech sector. 

``Numbers have generally matched the significantly lowered estimates ... and I think that is going to continue,'' said Jon Brorson, director of equities for Northern Trust at Northern Funds, which manages a total of $335 billion in assets. 

Of the 259 companies in the Standard & Poor's 500 index that have issued earnings so far this reporting period, 150 companies, or 58 percent, have surpassed Wall Street estimates, while 74 companies, or 29 percent have met analysts' earnings forecasts, according to market research firm Thomson Financial/First Call. Another 35 companies in the index, or 14 percent, reported earnings that were short of estimates. 

The earnings picture is still extremely bleak, particularly when compared to recent years when robust economic growth lifted Corporate America's bottom line. With the S&P 500 companies that have reported thus far, earnings are down 4.7 percent year-over-year. In 2000, earnings gained 23.6 percent, according to Thomson Financial/First Call. 

Stocks flew higher last week as investors snapped up beaten-down technology shares after high-tech bellwethers like International Business Machines and Intel Corp offered upbeat earnings reports. The tech-stuffed Nasdaq Composite index jumped 10.3 percent for the week. 

But technology shares lost ground on Monday after Wall Street brokerages downgraded computer chip giant Intel and software maker Oracle Corp., reigniting fears the downturn in high-tech earnings is not over. 

``The million-dollar question is the outlook, and we don't have a good clear vision of what the future is going to hold,'' Brorson added. 

The Nasdaq Composite slumped 108.99 points, or 5.04 percent, to 2,054.42 in late afternoon trading. The Dow Jones industrial average fell 82.82 points, or 0.78 percent, to 10,497.03, and the S&P 500 index dropped 22.03 points, or 1.77 percent, at 1,220.95. 

The market's moves came as a slew of Dow Jones industrial average components issued their corporate scorecards on Monday, including Exxon Mobil, SBC Communications, Minnesota Mining & Manufacturing Co., and American Express Co. 

Exxon's earnings flew higher in the first quarter, beating analysts' estimates, on strong cured oil and natural gas prices and better profits from refined fuels such as gasoline. Its shares climbed $1.84 to $87.01. 

SBC's shares fell 24 cents to $39.76 after the local telephone company said its profits dropped 10.5 percent because of the slowing economy and costs to build its new Internet and long-distance telephone operations. It also warned its full-year results would fall below Wall Street forecasts. 

3M met analysts' expectations with higher earnings, but said it would cut 7 percent of its work force in a restructuring. It rose $2.16 to $114.66. 

American Express, known for its green charge cards, also issued earnings that were in line with expectations, although its profits fell 18 percent because of bond losses and slack spending by customers. It fell $1.22 to $40.28. 

An earnings report also came from soft drink, snack food and juice giant PepsiCo Inc, hitting analysts' estimates with a 18 percent jump in profits, led by strong sales of new drinks at its Pepsi-Cola North America division and volume gains across all divisions. Its shares rose 93 cents to $42.19. 

Analysts have cut their earnings estimates deeply in recent months as more signs emerged that sluggish U.S. economic growth was biting more deeply than expected into Corporate America's profits. 

On average, analysts expect operating earnings at S&P 500 companies to fall 2.3 percent, dropping 8.4 percent in the first quarter of the year. At the start of the year, analysts forecast earnings would rise 8.9 percent for the full year, and gain 5.3 percent in the first quarter. 

But some analysts say Wall Street's expectations are now so low that as long as companies continue to at least match estimates, investors will creep back into the stock market. 

``I think we're at a level from an earnings expectation standpoint ... where we are near a bottom,'' said Jeffery Kleintop, chief investment strategist at PNC Advisors. 

During bear markets, the percentage of analysts revising earnings upward typically bottoms at about 20 percent, and they have come close to that level in recent weeks at about 23 to 25 percent, Kleintop said. 

``The market has started to look across the valley in terms of looking six to nine months down the road and saying, 'These companies are meeting their lowered estimates, which is good and maybe we're seeing some stabilization,''' he added.