* UPS CEO warns "nervous" customers hurting sales * Europe remains biggest drag on corporate earnings * Q3 corporate profit forecasts revised down 2.5 pct on average * Whirlpool warns of "recessionary" U.S. demand * Weakening euro taking a toll on exporters' growth By Nick Zieminski and Scott Malone NEW YORK/BOSTON, July 24 Worries about a slowing global economy crimped corporate spending in the second quarter, leaving the chief executives of top U.S. companies including United Parcel Service Inc and DuPont Co more guarded on their growth prospects for the rest of the year. UPS, along with chip maker Texas Instruments Inc and printer maker Lexmark International Inc, said it would not grow profits as quickly as expected through the rest of the year, as the corporate customers that generate most of its volume hold the line on spending. "Economies around the world are showing signs of weakening and our customers are increasingly nervous," said Scott Davis, Chief Executive of the world's largest package-delivery company. "In the U.S., uncertainty stemming from this year's elections and the looming fiscal cliff, constrains the ability of businesses to make important decisions such as hiring new employees, making capital investments, and restocking inventories. This will further restrict economic growth." UPS said it now expects profit to rise about 3 to 8 percent this year, about half its prior forecast growth rate. Of 26 U.S. companies that have revised third-quarter profit forecasts since mid-June, 19 have cut them, with the average forecast being pulled down 2.5 percent, according to Thomson Reuters I/B/E/S. Even companies that beat Wall Street's expectations in the second quarter -- including DuPont, Illinois Tool Works Inc and Paccar Inc -- sounded a note of caution on the next six months. "We need to all be cautious as we look at these markets in the second half of the year," said DuPont CEO Ellen Kullman. "The expectations in Europe are very low and they're kind of bumping along the bottom in a recessionary mode." The chemical and seed maker told investors its full-year profit could come in at the low end of its guidance range, which would represent growth of about 7 percent in earnings per share. UPS shares fell 4 percent to $74.85, DuPont fell 1 percent to $48.14 and ITW fell 3 percent to $52 PICKING A WAY THROUGH Europe, where governments are considering slashing spending in the face of a sovereign debt crisis, remained the biggest worry for top U.S. companies with the strengthening U.S. dollar adding to their woes by reducing the value of their exports. Outside those common problems, many U.S. companies that have reported results so far this season said demand at home has held fairly steady and that sales in Asia continue to grow, albeit at a slower rate than they had been over the past few years. "It's the same story all around," said Catherine Avery, who runs asset management firm CAIM LLC. "It's all pointing to the same malaise and weakness on the international side. Even though all the big multinationals are getting hit by currency, these are the places you want to be." Pentair Inc, which makes water-filtration systems, and heavy truck maker Paccar were two companies that managed to assuage Wall Street's worries, posting better-than-expected results. Pentair held its full-year profit forecast virtually unchanged, while Paccar said it was growing its market share in the face of declining U.S. and Canadian demand for tractor trailers. Pentair shares rose 5 percent to $41.65 and Paccar rose 4 percent to $39.42 -- well above the level they had been trading at earlier this month before the company warned U.S. truck demand was softening. "They're squeaking by, which is great in this environment," Avery said of industrial earnings. "What we really need to happen next is to get the revenue numbers up, and that's only going to happen once we get on a path to better global growth." Pentair said it expected Europe's slump to moderate in the second half. "The rate of decline in volumes appears to be moderating in Europe," CEO Randall Hogan told investors on a conference call. The company said it expected European sales to fall 6 percent to 7 percent in the second half of the year, compared with an 8 percent first-half decline. It said the strengthening dollar was hurting its sales growth. More than half of the dollar's year-to-date gains have come in July, according to Standard & Poor's. The dollar is up 6.2 percent against the euro this year, which reduces the value of European sales when they are translated into U.S. currency. "Currency is a little worse than expected" this earnings season, said industrial analyst Jeff Windau of Edward Jones in St. Louis. "Recessionary forces in Europe will probably weigh on industrial growth over the next couple of quarters, but there are good opportunities with bigger markets like China. It's always a challenge to predict when either these economies to turn around, or when the market starts anticipating a turnaround." U.S. A WORRY? Whirlpool Corp missed Wall Street's targets for sales and earnings in the quarter, blaming weakness in Europe and the strong dollar, and its shares fell 7 percent to $62.84. The world's largest U.S. appliance maker even warned of weakness in its home market, with Marc Bitzer, who heads the company's North American operations saying "demand is at recessionary low levels." That assessment was somewhat at odds with what rival General Electric Co had to say about the state of the appliance industry when it reported second-quarter results last week. It said the U.S. appliance market had growth by 1 percent in the quarter, with its retail sales up 11 percent. ITW CEO David Speer said on Tuesday, after the company reported better-than-expected profit, that he believed the long-stagnant U.S. housing market was picking up, which could boost demand for its building materials. "We continue to be more optimistic about additional recovery in housing starts in 2013 and beyond," Speer said. Recent economic data has suggested overseas demand is tempering the U.S. industrial outlook, but U.S. manufacturing continues to expand. Financial information firm Markit said on Tuesday its U.S. "flash" manufacturing Purchasing Managers Index for July fell to 51.8 from 52.5 in June. July marked the fourth consecutive month of slower growth and the sector's weakest showing since December 2010. But the index remained above 50, indicating factory activity is increasing, only less rapidly. Earnings growth among multi-industry companies is coming in well ahead of forecasts, Barclays analysts said in a research note. Instead of the expected 5 percent profit increases, the average pace is closer to 7 percent or 8 percent, a minimal deceleration from the two prior quarters. "The world is sluggish, but the cycle remains on track," the analysts said. "China appears to be finding a bottom but not turning up yet, other emerging markets as well, Europe is very weak but not sequentially worse, the U.S. remains the main industrial growth driver and has slowed less than we thought."