Corporate Earnings Indicate Arrival of Recession
The profits of S&P 500 companies are estimated to have dropped 3.7% on average compared to a year ago, marking the second straight quarter of earnings declines for corporate America. Analysts predict a 7.3% profit slump for the April to June period, with the pinch from higher interest rates and wilting consumer demand extending into the third quarter of 2023. Margin pressures, bank headwinds, tech dominance, and China's support are among the key takeaways from the earnings season. Corporate share purchases are also waning as borrowing costs rise and cash reserves shrink.
