The title of this story is misleading - KGI didn't say it touchID would be omitted completely - it was stated that it wouldn't be under the screen. There is no way that Apple is releasing a phone at this time w/o touchID.
Edit: In re-reading what KGI has posted, it does appear that they are stating that there will be no fingerprint sensor whatsoever on the phone. I still find that highly unlikely. Apple can't take a step backward simply for the sake of shrinking bezels. Apple clearly isn't going to give up Apple Pay as their revenue model is continuing to move in the transactions/recurring revenue direction. This would have to mean that, without fingerprint, Apple would be expecting to have people authenticate with a new sensor (e.g. facial recognition) or using the Apple Watch. I can't see Apple requiring people to have an Apple Watch for Apple Pay. This would mean facial recognition, assuming that Apple Pay's agreements with merchants and payment providers would allow it. Maybe they believe that the facial recognition is reliable enough that this will work (the phone is typically facing you anyway when you hold it up to the terminal for Apple Pay), but it better work really, really, really well.