ANALYSIS - Fourth-quarter U.S. profits estimates on the rise

By Caroline Valetkevitch

NEW YORK, Oct 29 (Reuters) - A year that started in gloom and doom could end in cheers for U.S. corporate profits and leave the stock market positioned for a strong start to 2010.

Analysts have been forecasting a big jump in fourth-quarter earnings compared to a year earlier when the entire Standard & Poor's 500 index ended in a per-share loss.

Expectations for the fourth quarter have jumped even further as four out of five companies have exceeded forecast results in the third quarter.

S&P companies now are expected to show a gain of 205 percent from a year ago, compared with early October estimates for a gain of 193 percent, according to John Butters, director U.S. earnings at Thomson Reuters.

The S&P as a group is expected to earn $17.10 a share in the fourth quarter, compared with an estimate of $16.52 at the start of the month, he said.

While some companies may be experiencing a rebound, the biggest element in the spectacular increase is last year's abysmal performance when the economy was in the depths of the recession, analysts said.

More upward revisions could be ahead, they said.

"Assuming that our economic forecast for continued recovery proves valid, there seems to be room for these future expectations to move higher," analysts at PNC Financial Services Group in Philadelphia said in a note.