U.S. companies will generate no earnings growth in 2020 as the coronavirus spreads beyond China, deepening risks to global growth, Goldman Sachs said on Thursday.

The bank’s analysts cut their baseline earnings per share estimate for S&P 500 index companies to $165 from $174 in 2020, implying that profits will likely remain unchanged from a year ago.

“Our reduced profit forecasts reflect the severe decline in Chinese economic activity in 1Q, lower end-demand for US exporters, disruption to the supply chain for many US firms, a slowdown in US economic activity, and elevated business uncertainty,” Goldman strategist David Kostin wrote in the note.

Analysts had forecast a 7.7% rise in earnings, according to Refinitiv data.

The virus, which is believed to have originated in a market selling wildlife in the central Chinese city of Wuhan late last year, has infected about 80,000 people and killed more than 2,700, the vast majority in China. In the past week, several other countries also reported a spike in cases.

Goldman said it expects the S&P 500 to trade around 2,900 points in the near-term, which is 14.4% below the index’s record closing high hit on Feb. 19, assuming the U.S. 10-year Treasury yield drops to 1%.

“A more severe pandemic could lead to a more prolonged disruption and a U.S. recession,” Kostin said.

If the yield climbs to 1.5%, Goldman expects S&P 500 to hit 3,400 by the year-end. But if the U.S. enters a recessionary scenario, Kostin believes the index will lose 13% in 2020, and then potentially rebound to 10% growth in 2021.

Earlier in the day, Bank of America cut its world growth forecast to the lowest level since the peak of the global financial crisis in 2009.

Goldman thinks investors should consider more defensive equities. Here are some of the firm’s outlook shifts in it’s newest letter, per Yahoo Finance:

  • Real Estate: Overweight from Neutral
  • Utilities: Neutral from Underweight
  • Industrial: Neutral from Overweight
  • Financials: Underweight from Neutral

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