Concerns about the potential impact of recession on US corporate earnings are waning. Firstly, the number of companies citing the term “recession” has fallen for a third straight quarter, according to FactSet data. Secondly, the number of companies that issued negative earnings guidance is in line with its five-year average and below its 10-year average.

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Thirdly, for all the talk of a possible economic slowdown, it’s not showing up in earnings estimates. Typically, analysts reduce estimates during the first two months of a quarter, says FactSet. Estimates did indeed come down in April and May, but only by 2 per cent – smaller than the average reduction seen in the last five-, 10, 15-, and 20-year periods.