The last bulwark in equities is in danger of shattering, if the mood of chief executive officers is any indication.

A survey of sentiment among corporate stewards by the Conference Board showed that CEO confidence declined sharply in the second quarter of the year for the fourth straight time. Similar skepticism in the past has always coincided with a recession in profits, Lisa Shalett, chief investment officer at Morgan Stanley Wealth Management, said in a note.

“This is at odds with current trend in bottom-up analyst profit estimates which have continued to move higher since January,” she wrote Monday. “We are skeptical of that forecast because of cost inflation, slowing economic growth, a surging US dollar and the mix shift away toward services from goods in the manufacturing-heavy S&P 500 index.”

That’s bad news for the stock market, where the only thing giving bulls any peace is the relative sturdiness of profit estimates. Analysts currently expect S&P 500 Index earnings to rise by 10.5% this year and 9.3% in 2023, according to consensus estimates compiled by Bloomberg Intelligence.

The Conference Board’s measure slipped to 42 in the second quarter, the lowest level since the onset of the pandemic, from 57 in the prior period. Historically, a reading of that level has coincided with profits recessions or negative year-over-year changes in earnings. Over the past 40 years, the measure has only been that low in 1980, 1991, 2001, 2008, 2012 and 2020, Shalett wrote.

“CEO confidence is already flashing a major warning sign,” she said. “We could revisit prior market lows as second quarter and third quarter profits reveal cyclical vulnerabilities to the reality of normalizing economic growth after 2021’s V-shaped recovery.”

Earlier this month, Goldman Sachs Group Inc. strategists led by David Kostin said that US earnings estimates are too high and equities are not reflecting the risks of lower corporate profits.

US stocks tumbled into bear market territory Monday after Friday’s consumer price report sparked fears that efforts to combat inflation by the Federal Reserve may stifle growth.

This article was provided by Bloomberg News.