Wall Street analysts are finally starting to cut their year-end targets for the S&P 500 (SPY  ) and earnings estimates for stocks. Even so, analysts continue to see EPS growth of 10% in the second half of the year which seems to be disconnected from what we are seeing in other parts of the market.

Q2 earnings season is less than a week old, but some clear trends are emerging. Overall, earnings growth for the S&P 500 is forecast to come in at 4%. However, a deeper look reveals that the bulk of this earnings growth is coming from the energy sector, while the S&P 500 ex-energy is forecast to have a 1% decline in earnings.

Overall, a major gap has developed between what's happening in equity markets and Wall Street forecasts.

Here's a roundup of some notable downgrades:

UBS

UBS (UBS  ) sees recession risk increasing. It lowered its S&P 500 year-end forecast to 3,400 if a recession hits, while it sees an upside target of 4,500 if the 'soft landing' scenario comes to fruition.

At the start of the year, UBS believed that these risks were balanced. Now, it sees them skewed to the bearish side, thus it lowered its overall year-end target to 4,150 from 4,800.

Evercore ISI

Evercore ISI's (EVR  ) chief equity and quant strategist, Julian Emanuel also sees an increased risk of a recession due to a stronger dollar, tight labor market, supply chain issues, and excess inventories. These negatives will impact margins and EPS.

As a result of these factors, he lowered his year-end S&P 500 target to 4,100 from 4,200.

Bank of America

Bank of America (BAC  ) says a mild recession in the second half of the year is now its base-case scenario. As a result, it lowered its year-end forecast to 3,600 from 4,500. This took the bank from the high-end to the low-end of forecasts and implies another 7% drop from current levels.

It sees negative growth into the first quarter of 2023 which should send longer-term rates lower. It also reduced its 2023 EPS forecast to $200 from $230.