Analysts slashed their earnings expectations for the current quarter by 2.8% during July and August, per FactSet senior earnings analyst John Butters. But that's not as bad as it may seem.
Colas notes that last quarter, earnings weren't revised down by as much as they usually are and therefore set a more challenging bar for companies to beat. As a result, companies beat earnings expectations by a lower amount than both the five and 10-year averages during the second quarter. FILE - Signs at the intersection of Broad and Wall Streets stand near flags flying from the New York Stock Exchange on Sept. 4, 2024, in New York. After earnings grew 11.3% year-over-year in the second quarter, they are expected to increase 4.9% year-over-year in the third quarter, which will kick off in off in earnest with big banks on Oct. 11.