How is the debt debate impacting analyst expectations? Find out in FactSet Earnings Insight.

Over the last six days, the price of the S&P 500 has dropped 3.2%. Some have attributed this decline to the ongoing debate in Congress to increase the debt ceiling and the potential for a downgrade of the credit rating for the U.S.  Given the market’s concerns on these issues, have analysts lowered their expectations for earnings in 2011 over the last few days?  For both Q3 and Q4, the numbers have come down slightly, but these downward revisions could be due to factors other than the debate in Washington.

As for the Q2 earnings season, 76% of companies have reported EPS above the mean estimate and 72% have reported sales above the mean estimate.  As a result, the current blended earnings growth rate of 10.3% and the blended revenue growth rate of 11.2% are well above the estimates at the start of earnings season.

Some of the key themes that impacted earnings and sales for the second quarter (and may also affect future quarters) include high commodity prices, continuing global economic growth, and the impact of the disaster in Japan. It is also important to watch how the results of this earnings season affect future earnings and sales estimates for the index.

This week marks the final “peak week” of the Q2 2011 earnings season, as 100 companies in the S&P 500 and 3 companies in the DJIA are expected to announce second quarter earnings.