Of the 173 S&P 500 companies that have reported Q3 earnings as at October 23, the blended earnings decline is -3.8%, making for the first back to back quarters of earnings decline since 2009. See: Factset Earnings Insight October 23, 2015.
And its not just earnings that are in decline, sales are on pace to fall 4% for the third straight quarter as well. The last time sales and profits fell in the same quarter was also in 2009. See: US companies warn of slowing economy, to post first decline in earnings and sales since the last recession:
From railroads to manufacturers to energy producers, businesses say they are facing a protracted slowdown in production, sales and employment that will spill into next year. Some of them say they are already experiencing a downturn.
“The industrial environment’s in a recession. I don’t care what anybody says,” Daniel Florness, chief financial officer of Fastenal Co. , told investors and analysts earlier this month. A third of the top 100 customers for Fastenal’s nuts, bolts and other factory and construction supplies have cut their spending by more than 10% and nearly a fifth by more than 25%, Mr. Florness said.
Caterpillar Inc. last week reduced its profit forecast, citing weak demand for its heavy equipment, and 3M Co. , whose products range from kitchen sponges to adhesives used in automobiles, said it would lay off 1,500 employees, or 1.7% of its total, as sales growth sagged for a wide range of wares.
The weakness is overshadowing pockets of growth in sectors such as aerospace and technology.
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