According to latest data by Refinitiv, companies traded on European stock exchanges are expected to see their Q3 earnings drop to the lowest levels in three years. For the first time since early 2018, these companies are also forecast to see a drop in their revenues.

Companies listed on the pan-European STOXX 600 are anticipated to to see their Q3 earnings decline by 2.2%, a higher decline than the 1.9% forecast during the previous week. This would mark the biggest decline in quarterly earnings since Q3 2016.

Revenues are now forecast to fall by 0.3% in Q3 2019, but this is slightly better than last week’s forecast for a 0.4% decline for the quarter. Earnings have registered a decline for the past two consecutive quarters, marking a technical recession in the European corporate sector, mainly driven by the ongoing trade tensions between the US and China.

Meanwhile, the risks of a recession in the German economy have been climbing higher as economic data continues to disappoint. In addition, ongoing uncertainties surrounding Brexit are also weighing heavily on Eurozone’s economic growth lately.