MADRID (MarketWatch) --
Goldman Sachs Group Inc. and
Morgan Stanley were downgraded to neutral from overweight on Wednesday at J.P. Morgan Cazenove, saying rules proposed by U.S. banking agencies late last year could lead to increased capital requirements for investment banks. That proposal aims to assign market-specific risk weights without the use of credit rating agency ratings. It concerns the capital charges that should be placed on market-specific risk of debt exposures and securitization exposures. As a result, J.P. Morgan said Goldman and Morgan Stanley could see 10% to 14% rise in group risk-weighed assets. The analysts said they prefer UBS AG within the investment bank world, along with Credit Suisse Group AG , Barclays PLC and Deutsche Bank AG , then Goldman and Morgan Stanley. Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.
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