US earnings recession set to continue

Markets were mixed on Tuesday.

In the US, the Dow Jones Industrial Average slipped 0.1 percent while the S&P 500 was flat.

Elsewhere, the STOXX Europe 600 rose 0.1 percent but the Nikkei 225 fell 1.4 percent.

The US stock market was weighed down on Tuesday by disappointing corporate earnings. McDonalds in particular fell 4.5 percent after reporting weaker-than-expected same-store sales in the latest quarter.

According to FactSet, earnings for companies in the S&P 500 are on track to contract 4.5 percent in the second quarter from the prior year, marking the fifth consecutive quarter of earnings declines. That is actually better than the 5.3 percent fall expected by analysts as of 30 June 30.

However, S&P 500 earnings are now expected to decline in the third quarter as well, thus extending the earnings recession to six quarters.