The Q1 earnings reporting season is just barely starting to get underway, with the earliest reporters releasing their numbers, although the unofficial start isn’t until Monday when Alcoa is set to report before opening bell. Analysts are forecasting a 7.9% year over year decline for the S&P 500, marking the third consecutive quarterly decline and the biggest decline since the second quarter of 2009, says S&P Global Market Intelligence Senior Analyst Lindsey Bell.

The Q4 earnings reporting season only ended last week.

Q1 earnings in freefall

Analysts are currently forecasting earnings of $26.25 per share for the S&P 500’s first quarter earnings.

At this point, only three of the ten sectors on the S&P 500 are expected to post earnings growth, with the Consumer Discretionary sector being the only one in double digits currently. This is the fourth consecutive quarter in which Discretionary, Telecommunications and Healthcare are leading in growth forecasts. Things are going from terrible to horrendous in the Energy sector, which analysts are now forecasting a three-digit decline in Q1 earnings. Bell adds that this is the first time the sector is expected to post losses in the time they’ve been keeping records.

The Materials sector’s decline is in the double digits. Here are the current standings as the markets prepare for the Q1 earnings reporting period to go into full swing:

Q1 Earnings 1

Even without the atrocious Energy sector, Q1 earnings for the S&P 500 would still decline, according to forecasts, which suggest a 3.6% decline without it.

Earnings forecasts continue to erode

As of the beginning of the year, analysts were expecting the first quarter to bring a return to growth for the S&P 500’s earnings, but reality set in quickly as estimates have plunged rapidly over the last three months. Analysts were expecting the second quarter to show continued improvement in growth for the index, but now they’re predicting the fourth consecutive earnings decline:

Q1 Earnings 3

Currently analysts are expecting a return to growth for earnings in the S&P 500 in the third quarter and then strong improvement in the fourth.

Q1 Earnings 5

Despite the expected earnings declines in the first half of the year, analysts are expecting to see a slight increase in earnings for the S&P 500 with a commanding recovery next year:

Q1 Earnings 4

Q1 earnings early reporters doing well so far

So far the early reporters are doing exceptionally well as the beat rate is 79%, which is far ahead of the 66% average beat rate. Of course this percentage will likely decline as we get more earnings reports in starting on Monday.

Q1 Earnings 2

All charts in this article are courtesy S&P Global Market Intelligence.