Goldman Sachs expects that American companies will not achieve profits growth during the year 2020 due to the increased risks surrounding global growth with the spread of the Corona virus outside China.
According to Reuters, the bank's analysts lowered their basic earnings per share estimate for the companies listed on the Standard & Poor's 500 index to $ 165 from $ 174 in 2020, indicating that profits will likely remain unchanged compared to a year ago.
Analysts had expected a 7.7 percent increase in profits, according to Refinitiv data.
Goldman Sachs said the latest forecast was due to a sharp drop in Chinese economic activities in the first quarter, a drop in demand from American export companies, disturbances in supply chains and a slowdown in domestic economic activity.
The virus has infected about 80,000 people and killed more than 2,700, the majority of whom are in China. Last week, several countries announced a rise in the number of injured.
Goldman said he expects the S&P 500 index to hit 2,900 points in the near term, which is 14.4 percent below the record high closing level of the index it scored on February 19, assuming ten-year US Treasury yields drop to 1 percent. / p>
If revenue rises to 1.5 percent, Goldman Sachs expects the Standard & Poor's 500 Index to reach the 3,400 level by the end of the year.
Earlier on Thursday, Bank of America lowered its forecast for global growth to the lowest level since the height of the global financial crisis in 2009.
