Broker snap: Sell Lloyds into strength

Nomura Securities remains negative on Lloyds Banking despite regarding the recent results from the lender as 'incrementally positive'.The broker thinks the short-term negative reaction to the results could yet flip-flop, but longer term it remains 'negative towards Lloyds owing to asset quality, funding and capital issues.'Nomura would regard any strengthening of the share price as a selling opportunity, as it does not regard the valuation of 0.95 times book value as 'particularly attractive in a sector context.'Nomura has raised its earnings estimates after Lloyds management raised the HBOS synergy targets to £2bn but has done so with a certain amount of reluctance, saying 'we would now regard our assumptions as optimistic'.Nomura has a 'reduce' recommendation for the stock and aa price target of 53p.