Wall Street strategists have been slashing forecasts as the impact from the virus is set to be felt far further than the first quarter, putting 2020 profit growth in jeopardy. A week previous, many market watchers said they expected the virus to affect earnings in the first quarter but not much beyond that.
However, if it triggered a global recession, profits could"decline near 25per cent and equity markets fall similarly as stocks typically track earnings given past patterns when downturns occurred," Levkovich wrote.On Thursday, strategists from Goldman Sachs said they now expect zero profit growth for S&P 500 companies in 2020.
Wall Street's consensus earnings forecasts, which are based on estimates from analysts who cover individual companies, have come down as well, but mostly not as much as some of the forecasts from the banks.