The S&P 500 is in an earnings recession for the first time in three years, and it’s expected to get even worse. Analysts surveyed by FactSet currently project a steeper drop for the third quarter, with estimates calling for a 3.95% decline on average.

According to a report by Market Watch, the entirety of the S&P 500 index has reported abysmal results for the second quarter, showing an average earnings drop of 0.35%. Components posted a 0.29% decline in earnings per share in the first quarter, marking the first period of back-to-back declines since the second quarter of 2016. Earnings recessions are typically categorized as two straight quarters of falling earnings.

It isn’t expected to improve either, as most analysts project an even bigger drop in the third quarter. Some of the worst-performing companies for the second quarter were in metals and mining, with earnings for that subsector down 76% on average amid falling prices and rising costs for companies like Freeport-McMoRan Inc. The materials sector overall saw a 17.88% decline, led by weakness in mining that’s projected to persist for another quarter. Industrials were another negative area, though most of the sector’s 10.23% decline could be blamed on Boeing Co., which swung to a big loss after its 737 Max jets were grounded. Building products and construction companies were other big contributors to the sector’s decline.

Market Watch did report on a few “bright spots” in the earning report, however:

Software and IT services were among the bright spots in the tech sector, but storage and semiconductors helped drive a 5.98% average earnings drop for information-technology companies. Chip companies had been calling for a second-half rebound heading into the latest round of earnings, but now some executives are a bit less confident. And looking ahead to the third quarter, analysts model a 30.81% drop in chip-sector earnings, steeper than the 25.38% drop experienced in the latest period.

The other sectors to show profit growth were communication services, financials, real estate and utilities. Analysts expect the same five sectors that grew earnings in the second quarter to repeat that performance in the third quarter.-Market Watch

Protecting yourself against the decisions of central banks and the earning recessions, hold hard assets.   Some of the most popular are precious metals, such as gold or silver.

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