Another S&P 500 goal just little the airborne dirt and dust.
Goldman cuts its 2015 year-end target to 2,000 from 2,100. If Goldman Sachs’s estimates end up being accurate, this would mean a drop of approximately 3 percent for the S&P 500, its first negative year since 2011. A finish at 2000 would mark a 2.9% decline for the year, as the index ended 2014 at 2058.90.
Goldman also lowered its 2015 earnings-per-share estimate by 4% to $109 for the S&P 500, from a previous forecast of $114. The revised target suggests a 6% rise during the next three months, above the 4% average fourth-quarter return since 1950.
“S&P 500 has made a adverse 4Q yield within only 22per cent along the last 65 years”.
“For a second consecutive quarter, economic turmoil in China alongside mixed U.S. economic activity and a generally strengthening dollar will likely weigh on corporate results”, wrote Goldman’s equity strategist David Kostin. The investment firm predicted that the US economy would grow by 2.4 percent in 2016 down from 2.8 percent. Politics could also unnerve investors, with a possibly contentious debate on the debt ceiling approaching.
Goldman still expects the Federal Reserve to begin raising short-term interest rates in December, which the bank says historically has been associated with declining price-to-earnings multiples.
Near 7:10 a.m. ET, Dow futures were up 68 points, S&P 500 futures were up 10 points, and Nasdaq futures were up 23 points – all less than 1%.