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S&P 500 companies are expected report quarterly earnings of more than $340 billion over the next few weeks, as a combination of government stimulus and surging economic growth drives bottom line growth, but rising interest rates, U.S.-China trade tensions and the fading affect of Republican-led tax cuts likely points to a steady slowdown in the months ahead. 

Third quarter earnings, however, are still expected to rise by around 22.2% from the same period last year, according to I/B/E/S data from Refinitiv, and around 78.6% of the 84 companies that have reported so far has topped Street estimates, just ahead of the 77% average over the past four quarters. Revenue growth, too, has been impressive, with around 38% of companies beating topline forecasts thus far and sales for the quarter expected to growth by 7.3%. However, European earnings are only likely to growth by 13.6% over this reporting period, and the downward trend in global economic growth suggests global corporate profits will slow next year as well.

"The earnings picture has softened over the course of this year, especially outside the US.," Bank of America Merrill Lynch said in a Friday client note. "Trailing earnings growth is slowing and earnings revisions trends are deteriorating. At the same time, looking ahead consensus 2019 EPS growth of 9.8% for MSCI ACWI is broadly consistent with a global economy delivering 3.7% growth."

"However, we are approaching something of a crunch point," the report added. "Outside the US, EPS revisions ratios are already relatively weak and at -2.8% over the past three months are sitting at long-term average levels. This underlines the importance of the current earnings season for equity investors. Early signs are moderately encouraging with 73% of stocks in MSCI ACWI that have reported so far beating numbers. However, the beats continue to be skewed to the US."

Around 160 companies are expected to report this week, including tech giants Amazon (AMZN) - Get, Inc. Report , Alphabet (GOOGL) - Get Alphabet Inc. Class A Report and Microsoft (MSFT) - Get Microsoft Corporation Report as well as industrial bellwethers Ford (F) - Get Ford Motor Company Report , Boeing (BA) - Get Boeing Company Report , Lockheed Martin (LM) - Get Legg Mason, Inc. Report and Caterpillar (CAT) - Get Caterpillar Inc. Report , as the reporting season shift into high-gear. 

Curiously, despite the stronger U.S. dollar, export-focused American firms have seen earnings grow 16.5% so far this quarter, compared to 15.2% for those that are more focused domestically, suggesting that companies are failing to capitalize on the tight jobs market and the stronger consumer spending it should create. 

And while the 22.2% growth estimate is impressive, corporate bottom lines have been trending lower since the start of the year, when earnings grew 26.3% in the first quarter and 25.8% over the three months ending in June. Once the current tax cut impact, which Credit Suisse estimates has boosted profits by 7.5%, fades, comparative earnings will slow with it: first quarter earnings for 2019 are expected to grow by only 8.1%, the slowest in nearly three years, with the best quarterly estimate -- 11.9% -- not expected until the three months ending in September of next year. 

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That pessimism was reflected in last month's BAML global fund managers survey, which polled 231 investment managers who run more than $646 billion worth of assets and noted that investors are also holding cash positions steady in their portfolios at 5.1%, the highest in 18 months, and still consider a global trade war the biggest "tail risk" for the market for the sixth consecutive month.

A record 85% of the survey respondents said the global economy is in the later stages of its growth cycle, a figure that is some 11 percentage points higher than the previous high of December 2007. When asked how the global economy will develop over the next year, a net 38% said they expect a slowdown, and that's the worst outlook on global growth since November 2008.

The growth concerns have fund managers trimming expectations for corporate profits, as well, with a net 20% of respondents seeing a slowdown for next year. In fact, a net 35% don't expect corporate profits to rise more than 10% next year, compared to the same amount that were predicting 2019 improvement when polled in February.

Last month, the International Monetary Fund said trade tensions between Washington and Beijing, alongside tighter financing conditions in emerging markets and uncertainty in Europe, will weigh on growth this year and next, while the bump from fiscal stimulus in the United States will fade just as higher borrowing costs begin to crimp consumer demand in the red-hot U.S. economy.

"U.S. growth will decline once parts of its fiscal stimulus go into reverse," said IMF chief economist Maurice Obstfeld . "Notwithstanding the present demand momentum, we have downgraded our 2019 U.S. growth forecast owing to the recently enacted tariffs on a wide range of imports from China and China's retaliation."

The Fund's global growth assessment was trimmed by 2 percentage points to 3.7% for this year and next, while its World Economic Outlook update said U.S. growth will likely hit 2.7% next year, down from a previous assessment of 2.9%.

China's economy, the second largest in the world, will ease to 6.2% from a previous forecast of 6.4%. Both the U.S. and China assessments for 2018 were left unchanged and 2.9% and 6.6% respectively, with the Fund saying that tit-for-tat tariffs, currently applied to around $300 billion worth of goods, likely won't hit growth metrics until 2019.

"This month, trade war remains the biggest "tail risk" for FMS investors, although conviction fell for the thirdmonth in a row as concerns about Quantitative Tightening rise; note July was the highest reading since concerns surrounding EU sovereign debt funding in Jul '12," the survey noted.