“Covid-19 could drive earnings contraction in 2020” compared with consensus expectations for 2.9% growth, Credit Suisse analysts Gerald Wong and Kwee Hong Ching wrote in a note dated Wednesday. Analyst estimate cuts so far factor in a virus impact of one quarter but “we expect further earnings cuts to come” due to weakness in tourism and a negative impact from Federal Reserve rate cuts, the analysts said.
SINGAPORE (Mar 5): Singapore’s globally lauded efforts to contain the deadly coronavirus may not be enough to help the nation’s companies avoid an earnings recession.
Analysts at Credit Suisse Group and Citigroup Inc. are concerned that the profit hit from the epidemic may be larger than the market currently expects for the nation’s companies. Disappointing profits pose a downside risk for Singapore’s US$443 billion ($614 billion) stock market, which has held up better than Asean peers amid the spread of the virus.
