JPMorgan downgrades Jupiter Fund Management to 'neutral'

"We downgrade Jupiter…as our channel checks indicate net outflow continued in Q421, which we estimate at £0.9bn, with limited visibility on an inflexion point," JPM said.

"Jupiter's shares are not expensive and potential bid speculation could limit material absolute downside risk but conversely we believe an inflexion in flows is required for a re-rating."

JPM cut its price target on Jupiter to 290p from 345p.

The bank’s preferred names in the sector include DWS, Man Group and Quilter, as it expects them to deliver good flow momentum and earnings growth at an attractive valuation.

JPM kept its ‘underweight’ rating on Hargreaves Lansdown, reflecting heightened competitive pressure which could impact earnings. It also retained its ‘underweight’ on Ashmore as it continues to expect pressure on asset under management growth in the near term from both negative investment performance and flows.

At 1000 GMT, Jupiter shares were down 4.1% at 248.91p.