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STOCKS NEWS EUROPE-Hargreaves Lansdown hit as MS cuts price target

Financial services and investment management group Hargreaves Lansdown (LSE: HL.L - news) falls by around 5 percent, making it the worst-performer on the FTSE 100 in percentage terms, which traders attribute to a price target downgrade on the stock from Morgan Stanley (Berlin: DWD.BE - news) .

Hargreaves Lansdown shares are down by 4.5 percent at 1,264 pence in mid-morning trading, having earlier fallen to a 2014 low of 1,256 pence.

Morgan Stanley keeps an "overweight" rating on Hargreaves Lansdown, whose shares are down by around 7 percent since the start of 2014 but are still up by nearly 90 percent since the start of 2013.

While Morgan Stanley maintains the "overweight" recommendation, pointing to the fact that it sees Hargreaves Lansdown as having a 'high-quality franchise', it nevertheless slashes its price target to 1,495 pence from 1,670 pence.

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Morgan Stanley writes in a note that pressure on pricing and weaker net interest income will weigh on Hargreaves Lansdown's earnings over the coming year.

"It's the two pound target downgrade from Morgan Stanley that's hitting the stock," said Prime Wealth Group senior trader Dafydd Davies.

However, Davies adds he would recommend buying Hargreaves Lansdown shares on the dip as he feels the stock could rebound later in the year.

Reuters messaging rm://sudip.kargupta.thomsonreuters.com@reuters.net