By Kate Gibson

With Alcoa Inc. leading the start of the second-quarter earnings season, analysts say the lack of revenue growth from the aluminum giant and the other 29 companies that make up the Dow Jones Industrial Average is a major factor contributing to Wall Street's lackluster sentiment.

On Thursday, energy shares led modest gains and health care led sector decliners as Wall Street pulled mildly higher in the afternoon.

The Dow (DJI) rose 4.76 points to stand at 8,183.1. The S&P 500 (SPX) added 3.12 points to finish at 882.68, while the Nasdaq Composite (RIXF) gained 5.38 points to 1,752.5.

"Expectations for an eighth consecutive quarter of declining profits has been out there for a while, and we've seen the (market) response already built in, in the last week and a half as things pull back," said Steve Hagenbuckle, managing partner of TerraCap Partners, a distress real estate private equity fund.

"We'll see a flat to slightly down response in general," Hagenbuckle added.

The first Dow component to report results for the quarter, Alcoa (AA) came in late Wednesday with a narrower-than-expected loss. .

Since pretty much every company in the country has trimmed costs during the current recession, positive earnings surprises that stem from cost-cutting translate into limited upside for stocks, analysts say.

"As the old saying goes, you can't save your way to prosperity," said Nicholas Colas, chief market strategist at BNY ConvergEx Group.

Judging from individual company weightings that make up the Dow, nearly 40% of the blue-chip benchmark is unlikely to show positive revenue comparisons until 2010, at the earliest, said Colas. The strategist lists IBM Corp. (IBM), Chevron Corp. (CVX), 3M Co. (MMM) and Caterpillar Inc. (CAT) as examples.

Grounded

Of course, revenue growth alone isn't enough to bolster a stock, said Colas, who cites Boeing Co. (BA), also a Dow components, as a stock that should have been a top performer this year, since its "long lead time business model gives excellent revenue and earnings visibility."

However, the recent news of yet another delay in the rollout of Boeing's 787 Dreamliner program dented revenue expectations for 2010 and beyond, bringing the stock down from $53 to under $40 a share. .

On Thursday, shares of the aerospace giant were off 21 cents, or 0.5%, at $39.34.

Looking at the beleaguered financial sector, two Dow members -- J.P. Morgan Chase & Co. (JPM) and Bank of America Corp. (BAC) -- promise to report significant revenue growth after making large acquisitions.

The past three months, J.P. Morgan Chase shares have advanced 2.8% and are up 6.8% year to date, while shares of Bank of America have gained nearly 37% during the past three months -- but are off 13% in 2009.

"J.P. Morgan's stock," said Colas, "has fared better than Bank of America due to investor perceptions of differing levels of balance-sheet strength and management depth."