Citi puts AJ Bell and Hargreaves Lansdown on 'negative catalyst watch'

Citi has placed AJ Bell and Hargreaves Lansdown on "negative catalyst watch" as part of its review of the European diversified and specialty finance sector.

"The growth-oriented diversified financials sector has faced a challenging couple of years, as financial investors have favoured banks and insurance. Yet expectations for falling interest rates during 2024 should be supportive for the sector as a whole, and in particular for the alternative asset managers, which is our preferred subsector," the bank said in a research note.

Citi said it is overweight the exchanges and underweight the investment platforms and Swiss private banks.

"Our most-preferred stocks are Allfunds, Intermediate Capital Group and London Stock Exchange Group. Our least-preferred stocks are EQT, Hargreaves Lansdown and Vontobel. We open new negative catalyst watches on AJ Bell and Hargreaves Lansdown."

AJ Bell shares were down 0.9% at 294.4p by 0909 GMT, while Hargreaves Lansdown fell 0.8% to 721p.