Richard Staite, an analyst with Atlantic Equities, slashed his earnings estimates for the two institutions in a recent note to clients, reports the Financial Times.
"The third quarter is shaping up to be another very slow period for client activity across most markets," he stated.
"July and August  were particularly weak and September is unlikely to make up for the shortfall."
He predicted that Goldman Sachs fixed income desks would record a four per cent drop in revenue compared to the second quarter, although a 32 per cent rise in equity trading revenue was also forecast.
Mr Staite's report was more negative for Morgan Stanley, with a ten per cent fall in fixed-income, currencies and commodities revenue expected, along with a 15 per cent drop in equity trading.
Earlier this month, insider sources told Bloomberg that Goldman Sachs is considering closing its principal strategies unit to comply with new regulations on firms making bets with their own capital.
By Asim Shah