While the debate rages over whether the real economy is going into a recession, the reality is that the earnings recession has already arrived,” warns David Rosenberg, chief North American economist at Merrill Lynch.

With 90 per cent of the S&P 500 companies having reported, third-quarter earnings per share is down 8.5 per cent year-over-year, a huge swing from a positive 9.6 per cent in the second quarter and plus 11.6 per cent a year ago.