Strategists clamor to cut S&P 500 forecasts

Traders work on the floor of the New York Stock Exchange.
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Traders work on the floor of the New York Stock Exchange.

With less than three months before 2015 ends, Wall Street firms are growing increasingly doubtful that stocks can mount a big fourth-quarter comeback.

"We hate to do this as we know it seems equivocal, but we cut our 2015 S&P target despite our fundamental longer-term S&P EPS and 10-year real interest rate views (cost of equity base) still being intact," Deutsche Bank equity strategist David Bianco wrote Friday.

A weak jobs report for September released Friday, which showed a sizable downshift in private jobs growth, proved that the Fed missed its chance to raise rates in 2015, according to Bianco.

"It means rates, currency, commodity and P/E uncertainty continues. It also means spartan interest rate conditions for banks in 2016," the strategist said.

That sentiment was echoed Monday by Bank of America Merrill Lynch strategists, who reduced their year-end price target for the S&P 500 for the second time in the past 30 days.

After the sharp losses in the past two months, other investment firms like Goldman Sachs and JPMorgan have also issued tepid projections on where stocks could close out the year.

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