After a great start to the year, U.S. earnings growth is slowing as the trade dispute between the U.S. and China escalates and starts to affect corporate giants such as Ford Motor Co. and Caterpillar Inc.
Steel tariffs have already cost Ford $1 billion in profits, and Caterpillar reported a cost of $40 million in its most recent quarter.
According to Refinitiv data, earnings growth for the third quarter is still high at 22 percent, but the amount by which S&P 500 index companies are beating analyst estimates is nearly half of what it was during the first quarter. Rising interest rates and slower earnings growth may be eroding investor interest.