CORRECTED - PREVIEW-Little optimism as U.S. manufacturer earnings loom

(Corrects date in final bullet point to April 24 from 23)

* Harley-Davidson, Parker Hannifin, ITW report Thursday

* GE reports Friday

* Eaton Corp reports April 20

* Caterpillar, United Tech, Pentair, Terex report April 21

* 3M, Honeywell, Kennametal report April 24

By James B. Kelleher and Scott Malone

CHICAGO/BOSTON, April 14 (Reuters) - Investors will get a
fresh snapshot of how brutally the global downturn is pounding
the industrial sector over the next week or so as heavyweights
including GE, United Technologies and 3M report quarterly
results.

Caterpillar Inc (CAT.N) could provide a particularly stark
illustration of the sector's hardship, with most analysts
predicting the world's No. 1 maker of building equipment will
be the first blue-chip industrial to report a quarterly loss in
this downturn.

Wall Street is bracing for ugly first-quarter reports from
other top industrials as well. Analysts on average expect
General Electric Co (GE.N) earnings to fall 52 percent on a
per-share basis, according to Reuters Estimates. They
anticipate a 23 percent drop in profit at United Technologies
Corp (UTX.N) and a 38 percent drop at 3M Co (MMM.N).

With expectations so low, attention will be focused on any
forecasts the companies provide that hint at either continued
deterioration in end markets or any early signs of
stabilization.

The pace of new orders -- critical at a time when many
investors are worried about the reliability of companies' order
backlogs -- and pricing will also be key issues.

"The question everybody's trying to answer is when do we
reach the trough? Is it late in 2009 or will it be 2010?" said
Matt Collins, capital goods analyst at Edward Jones in St.
Louis.

"When you look at consensus, analysts are looking for
growth to resume in 2010 and I think investors will be looking
for signs that might happen," Collins said.

The list of about a dozen industrials reporting results
over the next week or so also includes Harley-Davidson Inc
(HOG.N), Parker Hannifin (PH.N), Illinois Tool Works (ITW.N),
Eaton Corp (ETN.N), Pentair Inc (PNR.N), Terex Corp (TEX.N),
Honeywell International Inc (HON.N) and Kennametal (KMT.N).

WORSENING

Unfortunately, the preliminary signs have not been
encouraging. On Monday, diversified U.S. manufacturer SPX Corp
(SPW.N) cut its full-year earnings per share forecast by 18
percent and warned that first-quarter results would come in at
the low end of its prior forecast.

SPX, which makes everything from cooling towers for power
plants to tools for repairing cars and had already been bracing
for lower sales, blamed the cuts on weaker-than-expected sales
across a variety of markets.

Other companies cutting their 2009 forecasts over the past
several weeks included United Tech, Ingersoll-Rand Co (IR.N),
Emerson Electric Co (EMR.N) and Manitowoc Co Inc (MTW.N).

In almost every case, the companies have complained that
demand had fallen off even more sharply than they had foreseen
when they made their budget plans a few months ago.

Additional disappointments may be coming. Deutsche Bank
analyst Nigel Coe wrote in a note to clients that he believes
the second-half rebound assumptions contained in many
companies' numbers are "still too aggressive."

WHAT STIMULUS?

The first-quarter results will underscore another
unpleasant truth for the industrial sector: Though President
Barack Obama claims his administration was "ahead of schedule
and under budget" on the first of thousands of infrastructure
projects that are part of his $787 billion stimulus plan, those
upgrades of highways, bridges and transit systems do not appear
to be providing much immediate help to U.S. manufacturers.

Things are so uncertain, in fact, that GE has stopped
providing specific per-share profit guidance, instead sketching
out a "framework" of how it expects individual divisions to
perform.

GE executives told investors last month that economic
modeling based on the Federal Reserve's assumptions for the
U.S. economy could cause profit at the hefty GE Capital arm to
fall even more than GE had anticipated. But they declined to
describe that scenario as an update to their "framework" for
the unit.

The news this quarter is expected to be especially
disappointing at Caterpillar, which moved aggressively over the
past few months to bring its construction and mining equipment
production in line with fast-falling demand, cutting nearly
25,000 full-time and contract workers.

Reuters Estimates predicts the Peoria, Illinois-based
company's first-quarter profit will fall 95 percent to 7 cents
a share, down from $1.45 last year.

But factor in the restructuring charges associated with
those layoffs and GAAP reported numbers will almost certainly
show a loss -- the first since 1992.

Andrew Obin, an analyst at Merrill Lynch, expects the slump
and costs associated with that restructuring to force
Caterpillar to report a loss of 74 cents a share on a GAAP
basis.

The good news for Caterpillar? Obin predicts the quarter
will "mark the weakest performance by the company's
manufacturing operations in the cycle" and expects
Caterpillar's full-year loss to narrow to a penny a share.

If there is any good news here for the broader sector, it
is that the massive cuts and restructurings the industrial
companies have undertaken in recent months should begin to show
signs of paying off in the coming quarters -- if sales
stabilize.

"They've taken a lot of medicine and it's starting to heal
the wound," said Peter Klein, senior portfolio manager at Fifth
Third Asset Management in Cleveland, Ohio, which counts GE,
United Tech and Honeywell among its holdings.

"You want to see some near-term stability regardless of the
top line," Klein said. "My feeling is that a lot has been done
in the past six months and we would begin to see some
stabilization on the margin side of things."
(Reporting by James Kelleher and Scott Malone, editing by
Matthew Lewis)