NEW YORK (Reuters) – As Wall Street braces for what may be the first U.S. profit decline since 2016, investors say the first quarter may not mark the low point for 2019 earnings.

In the immediate term, markets could be roiled depending on what or if any information is released from Special Counsel Robert Mueller’s report on his investigation into Russia’s role in the 2016 presidential election, which was submitted to Attorney General William Barr late on Friday.

Concerns about economic weakness in the United States and abroad and the lack of a U.S.-China trade deal are hanging over the longer-term outlook, even as the Federal Reserve’s dovish stance on interest rates is expected to relieve some of the pressure on companies and the economy.

In a troubling sign for the U.S. outlook, a report on Friday showed U.S. manufacturing activity unexpectedly cooled in March, and the spread between three-month Treasury bills and 10-year note yields inverted for the first time since 2007. An inverted Treasury yield curve is seen as a warning of a coming recession.

As stocks sold off in December, some investors worried 2019 would bring a profit recession for S&P 500 companies, defined as at least two quarters of year-over-year declines. The last U.S. profit recession ran from July 2015 through June of 2016.

Analysts, after cutting earnings forecasts for 2019, now expect a 1.7 percent year-over-year earnings decline in the first quarter, and some profit growth for the rest of the year, according to IBES data from Refinitiv.

With the Fed on pause and stocks rebounding, optimism seemed to be increasing that the profit outlook would stabilize after hitting a low point in the current quarter. Many investors say that is now less certain.

“It would be great if Q1 represented a low point, but I’m not betting on it,” said Jack Ablin, chief investment officer at Cresset Capital Management in Chicago.

“I worry that the comparisons are going to be much more difficult as we navigate the rest of the year.”

This year’s earnings growth already was expected to shrink dramatically compared with 2018, when steep corporate tax cuts fueled earnings gains of about 24 percent.

Since the start of the year, the forecast for second-quarter profit growth has fallen to 3.0 percent from 6.4 percent, while estimated growth for the third quarter has dropped to 2.7 percent from 4.9 percent, based on Refinitiv’s data. The fourth-quarter growth estimate has come down as well, though it is still relatively strong, at 9.1 percent.

Those numbers could keep falling, while the first-quarter forecast is likely to improve from here. Since 1994, earnings have surprised to the upside on average by 3.2 percent, according to Refinitiv data, which suggests S&P 500 companies will post an earnings gain for the first quarter.

Still, with investors largely discounting weaker profit trends, the first-quarter reporting period could bring market volatility, Ameriprise Financial strategists said.

On Tuesday, FedEx Corp cut its 2019 profit forecast for the second time in three months, causing its stock to drop and raising fresh worries about the impact of the trade conflict on earnings. The company cited slowing global economic conditions and weaker trade growth.

Also, Nike’s shares fell 6.61 percent on Friday after it reported North American sales that fell short of expectations.

The United States initially had a deadline to reach a deal on trade with China by March 1, but the White house has said it needs more time.

“There are real concerns. FedEx’s numbers are a perfect example. There’s been a global growth slowdown, and companies are communicating that in terms of their guidance for the first quarter and throughout the year,” said Anthony Saglimbene, global market strategist at Ameriprise Financial in Troy, Michigan.

To be sure, a lot of those fears could be reversed if there is a resolution in the U.S.-China trade conflict, and if companies’ first-quarter reports are not as weak as expected, he said.

Strategists said they expect to hear more from companies on the trade conflict when first-quarter reporting kicks into high gear around mid-April.

“So much is dependent on what we do with the trade situation with China. The real issue will be the global economy, and in particular, trade with China,” said Rick Meckler, partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey.