Banks felt the wrath of brokers on Monday as the effects of last week’s referendum result continue to rumble on.
Jefferies International said that, following the Brexit vote, it moves “to a slow growth/ modestly recessionary scenario for the UK banks”, while JP Morgan Cazenove also re-confirmed its “cautious banking sector view”.
Jefferies moved RBS to a ‘hold’ recommendation from ‘buy’; Barclays downgraded the stock from ‘equal weight’ to ‘underweight’; while JP Morgan Cazenove also lowered its rating to ‘underweight’ from ‘neutral’.
RBC Capital Markets was perhaps the most brutal of the four, downgrading RBS to ‘underperform’ from ‘outperform’, while setting a target price of 165p, some 40p below this morning’s opening price.
Another bank, this time Barclays PLC (LON:BARC), was downgraded by JP Morgan Cazenove from ‘overweight’ to ‘neutral, while Jefferies International lowered the stock from a ‘buy’ recommendation to ‘underperform’.
Jefferies also slashed its target price for the stock from 287p down to 115p, saying the bank’s earnings power has been “substantially diminished” by the UK’s vote in favour Brexit.
Lloyds Banking Group PLC (LON:LLOY) was moved down to an ‘equal weight’ rating from ‘overweight’ by Barclays Capital, while the stock was also downgraded by JP Morgan Cazenove to ‘neutral’ from ‘overweight’.
Cantor said it had cut its full year profit before tax forecasts by £100mln after the airline issued a profit warning.
The broker also believes that “the potential impact on demand and yields” from the Brexit vote may cause problems for EasyJet.
Cantor said that the postal service group could be a “good potential safe haven” in this current period of instability.
It says market expectations for profits and margins this year “appear conservative” and believes significant efficiency savings will help to boost the bottom line.
The broker says that Mariana has two “major milestones” on the horizon at its 30%-owned Hot Maden gold/ copper project.
Northland says one of those milestones, the preliminary economic assessment (PEA), will give investors an initial impression of the project’s economics and metrics.
Northland says that the company is “grossly undervalued”, because it has exposure to three cancer immunotherapy programmes which are funded through early clinical trials.
The broker says the cancer immunotherapies market will smash the US$80bln barrier by 2020, hence the price target which is five times its current price.