JPMorgan upgrades StanChart after "material underperformance"

29th Jul 2014 13:32

Standard Chartered's share price was making gains on Tuesday after analysts at JPMorgan Cazenove upgraded their rating on the stock from 'neutral' to 'overweight' following a "material underperformance" over the past year.JPMorgan said that shares of the emerging markets-focused bank have underperformed the Stoxx Europe 600 Banks index by 27% over the last 12 months.It now foresees "stabilising pressures" in a number of key operations within India, Korea and parts of Wholesale banking."Since the second quarter of 2013, continuing negative earnings surprises have driven a valuation discount relative to peers (and underpinned our cautious view) leading to fundamental concerns on growth and asset quality. "In our view, some of the earnings headwinds facing the group could start to abate from end-2014, and with consensus now re-based lower, we see risk reward geared to the upside."JPMorgan has hiked its target price for the shares from 1,350p to 1,450p.The stock was up 2.3% at 1,250p by 13:09.BC