Goldman Sachs, Morgan Stanley Have Estimates Cut on Trading
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Goldman Sachs Group Inc. and Morgan Stanley, the major U.S. banks most reliant on trading, had their earnings estimates reduced by analysts as a weak fourth quarter dimmed prospects for a capital-markets rebound in the first half of 2012.
Sanford C. Bernstein’s Brad Hintz cut his fourth-quarter estimate for Goldman Sachs by 76 percent and almost quadrupled his expected loss for Morgan Stanley as “already anxious clients grew increasingly cautious,” he wrote in a note to investors today. Doug Sipkin, an analyst at Ticonderoga Securities LLC, lowered his 2012 Goldman Sachs estimate by 23 percent on a more pessimistic view of the firm’s fixed-income trading revenue.