Morgan Stanley, Citi Cut US Earnings Estimates as Season Starts

Morgan Stanley and Citigroup Inc. slashed their estimates for 2025 earnings as companies kick off their first-quarter reports, joining a wave of Wall Street banks warning that tariffs will curb profit growth.

Citi’s head of US equity strategy, Scott Chronert lowered his 2025 prediction for the S&P 500 to 5,800 from 6,500, predicated on earnings of $255 a share for companies in the index, down from a previous $270 projection. At Morgan Stanley, Mike Wilson cut his 2025 earnings-per-share forecast to $257 from $271.

“The 90-day pause on reciprocal tariffs and further concessions over the weekend lessen the near-term ...