With the market deep in the red to conclude the trading week, shares of Ericsson (ADR) (NASDAQ:ERIC), Morgan Stanley (NYSE:MS), Walt Disney Co (NYSE:DIS), and Citigroup Inc (NYSE:C) are leading Friday’s losers, as investors sell each stock for various reasons. Let’s take a closer look at the downside catalysts pushing them down and examine what the world’s greatest investors think of each stock.
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Ericsson (ADR) (NASDAQ:ERIC) shares are 6% lower in morning trading after analysts at Deutsche Bank lowered their rating to ‘Hold’ from ‘Buy’. Despite management’s commitments to cost cutting, the Deutsche Bank analysts don’t think Ericsson’s EPS will grow in 2016, as the company’s top-line shrinks and as weakness in emerging markets weighs on the company’s results. Also adding to the selling pressure is the broader market weakness today. Hedge fund sentiment around Ericsson (ADR) (NASDAQ:ERIC) has been stable, with the number of elite funds long the stock falling by just one to 11 during the latest 13F reporting period.
In other news, Morgan Stanley (NYSE:MS) shares have fallen by more than 4% as ‘risk off’ sentiment permeates throughout the financial sector. Although Morgan Stanley (NYSE:MS) won’t present its earnings results until next Tuesday, investors are selling now because they fear the emerging market weakness in conjunction with a slowing Chinese economy and a volatile stock market could hurt Morgan Stanley’s outlook for the next few quarters. Hedge funds have been bullish on the stock, however, with Cliff Asness‘ AQR Capital Management among 57 elite funds in our database that were long Morgan Stanley at the end of September. That 57 figure was up by nine from June 30.
On the next page we examine why it’s been a gloomy morning for Walt Disney Co and Citigroup Inc.