A Goldman Sachs analyst added Citigroup Inc. to a list of stocks to sell and cut estimates for Merrill Lynch & Co. late Wednesday while downgrading the brokerage sector.

Analyst William F. Tanona added Citigroup to the Conviction Sell list and cut his price target to $16 from $20. The new target implies he expects shares to slip 15 percent from Wednesday's $18.85 close.

"We see multiple headwinds for Citigroup including additional write-downs, higher consumer provisions as a result of rapidly deteriorating consumer credit trends, and the potential for additional capital raises, dividend cuts or asset sales," Tanona said in a note to clients.

He now expects a second-quarter loss of 75 cents per share and $9 billion in write-downs for the period. Analysts polled by Thomson Financial expect, on average, a loss of 3 cents per share for the period.

Meanwhile, Tanona cut his rating on the brokerage sector to "Neutral" from "Attractive," saying he sees few near-term catalysts.

On Merrill Lynch, Tanona expects second-quarter write-downs of $4.2 billion and a loss of $2 per share. Analysts forecast a loss of 14 cents per share for the period.

A representative from Merrill Lynch was not immediately available for comment.

A Citigroup spokeswoman declined to comment.

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