Worst Quarter in Five Years?

"It's a low bar and an easy hurdle to overcome, just as in previous quarters," says Paul Mendelsohn, chief investment strategist with Windham Financial. "When all is said is done, we could still come out with a growth rate of 7% or 8%."

Robert Pavlik, chief investment officer with Oaktree Asset Management, also doubts earnings will reach double digits, but concedes that it's "very difficult to gauge what damage the credit concerns did."

Heading into the second-quarter reporting weeks, profit growth was seen as coming in at about 4%. However, many companies exceeded expectations and the final growth rate was close to 8%.

"We think that may be likely again this quarter, although financial companies are a large part of the S&P 500, and financial-company writeoffs may play a larger role in the third quarter," says Bruce McCain, senior vice president and head of strategy for Key Private Bank's Investment Management Unit.

Several finance names have already posted mixed results due to the mortgage mess. Lehman Brothers (LEH Quote) and Goldman Sachs (GS Quote) were bright spots among those having already reported, while Bear Stearns (BSC Quote) and Morgan Stanley (MS Quote) delivered poor results.

Meanwhile, Citigroup (C Quote), UBS (UBS Quote), E*Trade Financial (ETFC Quote), Bank of America (BAC Quote) and Merrill Lynch (MER Quote) have also warned that turmoil in the credit market will impact earnings.