Broker snap: Slowing momentum at StanChart, as expected

27th Jun 2012 11:04

Nomura has maintained its 'buy' rating and 1,800p target price for emerging markets-focused bank Standard Chartered after the group reiterated its full-year guidance in a trading update on Wednesday morning."The IMS does not justify upgrades and these have been necessary to generate outperformance from the shares in the past. Overall STAN results highlight a drag from the deteriorating growth outlook and adverse currency movements, much as we were expecting," Nomura said. "Impairments have risen, which may indicate the early effects of economic slowdown, but was expected. Asset quality trends appear to be stable in management's view and it has reiterated that overall levels will be higher than the previous years."There were few surprises in the statement and the broker said that it continues to be positive towards the stock as a result of its "superior" fundaments compared with developed market banks.While there is a small risk of downgrades, Nomura said the bank is still seeing good growth and believes that downgrade risks are higher elsewhere in the sector.By 11:05, shares were 1.31% higher at 1,351.5pBC