2012 an inflection point toward S&P500 margin compression

I thought this was noteworthy from Andy Lees at UBS:

With 291 of the S&P 500 companies now reported, adjusted earnings are coming out +2.72% at USD23.78. The WSJ reports that profit margins suffered their biggest sequential decline since the crisis, although it should be said that in Q2 margins were at their highest level since 2006. According to Barclays, margins have hit an inflection point with 7 of the 10 sectors on track for margin contraction this quarter, which it says is ominous as margins usually contract 2 or 3 quarters before recession. Only 30% net of companies are beating expectations, whilst the number of companies issuing negative guidance on future profits has hit its highest level in at least 6 quarters according to Stanleys. Revenue growth is slowing

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