The largest U.S. bank by assets "offers the least upside" to price targets among its major competitors, according to John Heagerty of Atlantic Equities, who lowered his recommendation for JPMorgan Chase to neutral, as reported by Bloomberg. He wrote that he preferred Bank of America Corp. (BAC - Get Report) "from a defensive perspective."
JPMorgan, under CEO Jamie Dimon, is down about 7.9% this year, compared with a 17% decline for Bank of America. The broad KBW Bank Index and the narrower KBW Regional Bank index have both declined about 19 percent so far this year versus a 5 percent drop for the S&P 500 Index. JPMorgan rose $1.08 cents, or 1.1%, to $99.62 in trading on the New York Stock Exchange as of about noon.
JPMorgan shares are down about 10.7% over the past month, more than the banking sector's 7.8% decline and a loss of about 7.3% by the S&P 500 in the period.
The downgrade comes as the Federal Reserve is expected to raise benchmark borrowing rates for a fourth time this year, following a two-day meeting that ends today. Based on trading in futures markets on the Federal Reserve rate, there's a 73% chance that the central bank will boost interest rates by 0.25 percentage point to a range between 2.25% and 2.5%.