Corporate earnings forecasts are too optimistic, a growing chorus of analysts is warning, with the inevitable downgrades likely to put downside pressure on stocks and adding to concerns about a broader economic slowdown, inventory gluts, and weakening consumer spending intentions.
As Americans grow concerned that the U.S. economy could tip into a full-blown recession, one expert says evidence suggests that U.S. corporations will soon be hammered by a profit recession of their own as many have been unable to pass soaring input costs along to inflation-weary consumers and will have to scale back their earnings forecasts, pressuring stocks.