Is the Earnings Picture Deteriorating?

Corporate profitability has been a standout performer in this earnings cycle, with double digit growth in the last eight quarters. This earnings momentum has served as a key source of support for the stock market.

But all cycles eventually mature and turn around. This earnings cycle appears to be maturing in a backdrop of growing anxieties about the global economy. Europe is heading towards a recession and the extent of the Chinese slowdwon remains uncertain.

With about 40% of the earnings for the S&P 500 companies coming from international markets, it is doubtful that this worldwide slowdown will have no negative impact on corporate earnings.

Are the recent profit warnings from companies like DuPont (DD), Texas Instruments (TXN), Intel (INTC) and others pointing towards a materially deteriorating earnings picture? Or we can chalk all of these off to company specific issues unrelated to each other? 

 I don't think the earnings picture is materially deteriorating, but what do you guys think? Are current consensus earnings expectations adequately reflecting this worldwide slowdown?

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