NEW YORK ( TheStreet) -- Earnings season is upon us once again, and unsurprisingly Wall Street's growth expectations for the third quarter aren't quite as bullish as they were back at the peak of summer.
S&P Capital IQ says the consensus estimate for third-quarter operating earnings for the S&P 500 now sits at $24.43 per share, up 13% from last year's equivalent quarter but down 3.4% from $25.30 as of July 27. All 10 S&P sectors saw declines in expectations over that span with the financials (down 10.2%), telecom services (off 6.5%) and materials (sliding 5%) seeing the biggest drops.
The volatility in stocks since August has brought reined in optimism ahead of the flood of third-quarter reports. The major U.S. equity indices are all still off more than 10% from their late April highs, and economic data was dismal through the end of the summer, only recently showing some signs of life. Add in the uncertainty about the sovereign debt situation in Europe and it's no wonder estimates have come down in the past three months.
That may make it tough for stocks to rally much, even if results come out ahead of consensus, which typically seven of out of 10 companies are able to do."