Standard Chartered falls 3 percent to the bottom of Britain'sbenchmark FTSE 100 index in brisk volume, with traders citing worriesover a slowdown at its main Asian business and a broker downgrade as the mainreasons for the decline in its share price.
Earlier this week, Standard Chartered scaled back its income growth targetfor the next couple of years as slower economic growth and tougher regulationsbite, and added it planned to get rid of smaller, underperforming businesses aspart of a corporate restructuring.
The bank's lower growth targets and new restructuring programme promptsMizuho Securities to cut its rating on Standard Chartered to "underperform" from"neutral."
"We expect the shares to move down over the next year as the bank kicks offits corporate refocusing programme," writes Mizuho analyst James Antos in aresearch note.
Olivetree Financial Group does not believe the Mizuho downgrade is drivingdown the Standard Chartered shares but but is symptomatic of the investorresponse to Monday's presentations, when it cut its growth targets. Olivetreealso cites concerns over the bank's Korean and Indian units.
"Standard does not generate superior returns from its franchise and itspremium rating depends on its perception as a growth stock. Its problems inKorea appear intractable and this is a country where returns have always beenbelow the group average," says Olivetree Financial Group analyst Simon Maughan.
Standard Chartered's Hong Kong-listed shares had earlier closeddown by 2.2 percent but the stock still underperforms rival Asian-focused bankHSBC, whose shares are down by 1.3 percent in London.
Trading volumes in Standard Chartered's London-listed shares come in ataround 80 percent of the stock's average 90-day volume - above those for theFTSE 100 where volumes stand at 24 percent of the index's average 90-day volume.
Standard Chartered's London-listed shares have fallen by around 8.5 percentsince the start of 2013 - underperforming a 13 percent rise in the FTSE 100.
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