BUZZ-European I-Banks: to perform better than US, MS says

** Morgan Stanley (Xetra: 885836 - news) cuts earnings across European Investment Banks (IBs) coverage, says secondary volumes and primary issuance are weak, but relatively better in Europe and Asia

** Expects European banks to perform slightly better than US ones in the quarter, given geographical mix; however adds US banks had a much stronger 3Q16 vs European banks

** MS reduces PTs (Other OTC: PTSH - news) on Barclays (LSE: BARC.L - news) by ~8 pct, Deutsche Bank by ~5 pct and HSBC by ~5 pct

** MS says equities are strongest in Asia, weakest in US, with Europe somewhat in the middle in terms of volumes

** MS says structurally, wholesale banks should benefit from global reflation via increased corporate and market activity, & that potential for regulatory fragmentation and protectionism present key risks

** up 2.7 pct, by 0.8 pct; trading flat

(Reuters Messanging: aniruddha.c.thomsonreuters.com@reuters.net)