HSBC Global Research’s report on U.S. bank stocks highlighted that the repricing of fixed-rate assets, benign credit quality, improved investment banking activity, and a favorable regulatory environment shored up U.S. bank stock prices by 35% over the past three months. However, macro uncertainties persisted and possible interest rate cuts and slower economic growth seemed to be downplayed. Universal banks trade at PE premiums to their histories.

For Bank of America (BAC.US)      , HSBC Global Research’s report noted immense PE expansion despite less favorable earnings revisions compared to peers, suggesting limited upside after a 32% rally in the past three months. For JP Morgan (JPM.US)      , and Goldman Sachs (GS.US)      , the broker viewed the risk-reward profile as unattractive.

Related NewsCore Inflation Rate YoY for Jun in United States is 2.9%, higher than the previous value of 2.8%. The forecast was 3%.
HSBC Research's latest investment ratings and target prices for US bank stocks are listed below:

Shares│Ratings│TPs
Citigroup (C.US)      │Buy│US$86→US$97
Bank of America (BAC.US)      │Buy→Hold│US$47→US$51
Wells Fargo (WFC.US)      │Hold│US$71→US$79
Morgan Stanley (MS.US)      │Hold│US$117→US$131
JPMorgan (JPM.US)      │Hold→Reduce│US$237→US$259
Goldman Sachs (GS.US)      │Hold→Reduce│US$558→US$627
(Real-time Streaming US Stocks Quote; Except All OTC quotes are at least 15 minutes delayed.)