Lehman Brothers chief portfolio strategist Jeff Applegate on Monday cut his 2001 and 2002 earnings outlook for companies in the Standard & Poor's 500 Index because of continued economic weakness, joining other Wall Street experts who have lowered their views. 

Applegate, one of Wall Street's top strategists, cut his estimate for 2001 earnings per share for the index to $50.50 from $52.00, He cut his 2002 forecast to $61.00 from $62.00. 

Sales are slower and ``profit margin pressure greater than we had previously thought,'' Appelgate said in a note to clients. ``So while we've been forecasting a profits recession since February, it is somewhat worse than what we'd thought.'' 

Lehman's economics team is forecasting U.S. economic growth of just 1.8 percent in 2001, and 3.4 percent in 2002. 

Applegate maintained his asset allocation ratio in the firm's model portfolio of 80 percent in stocks and 20 percent in bonds. His 12-month price target for the S&P 500 is unchanged at 1450. 

The index fell 3.66, or 0.3 percent, to 1210.71 in morning trading. 

Applegate's announcement follows that of other Wall Street strategists last week. 

UBS Warburg's Ed Kerschner and Credit Suisse First Boston's Tom Galvin both cut their earnings expectations for the S&P 500 index, while JP Morgan's Doug Cliggott dropped his 2001 and 2002 year end price targets for the index.