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Market Review: Sept 2022

  • Robert Santarpia

S&P Earnings Growth Rate is Slowing Down!

According to data firm FactSet, third quarter earnings growth rate for the S&P500 is expected to be 2.9% which would make it the lowest earnings growth rate reported by the S&P500 index since third quarter of 2020. On 30th June 2022 analysts had estimated the earnings growth rate for Q3 to be 9.8%. Ten sectors are expected to report lower earnings (compared to the previous estimates provided on June 30) due to downward revisions to EPS estimates. The continuing negative trends in corporate earnings don’t bode well for the US and the world economy. As shown in the table below, the average decline in EPS during recessions is circa -29.5% peak to trough and circa -18.7% if we take out the dot com crisis and Global Financial Crisis.

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