Goldman Sachs has lowered its S&P 500 earnings forecast and highlighted key issues for 2016 that investors should watch out for in the year ahead.
Goldman's U.S. equity team, led by chief U.S. equity strategist David Kostin, said in a note late on Thursday that it was lowering its S&P 500 earnings per share (EPS) forecast by $3 to $106, $117, and $126 for 2015, 2016, and 2017.
The revision reflected annual EPS growth of -7 percent in 2015, +11 percent in 2016 and +8 percent in 2018, the note stated, with the strategists expecting that 2015 was "the worst year for S&P 500 earnings since 2008."
Goldman said the energy sector was "the leading driver of its reduced profit outlook" and expected the sector to post a decline in operating EPS for the first time in 48 years. Energy companies in the U.S., and elsewhere, have taken a beating on the global decline in oil prices which have hit 12-year lows of around $32 this week.