STOCKS NEWS EUROPE-Schroders buoyed by HSBC upgrade

Shares in Schroders (SDR.L) gain 1.1 percent after HSBC upgrades its stance on the fund manager to "overweight" from "underweight" with an increased target price of 1,625 pence, up from 660 pence, as a new analyst assumes coverage of the UK asset managers.

In a reshuffling of its ratings throughout the sector, HSBC also ups its stance on mid caps Aberdeen Asset Management (ADN.L), to "overweight" from "underweight", F&C Asset Management (FCAM.L), to "overweight" from "neutral", and Blue Bay Asset Management BBAY.L, to "neutral" from "underweight", raising targets for all three.

The broker cuts its rating for both Ashmore (ASHM.L) and Henderson (HGGH.L) to "neutral" from "underweight", although it raises price targets for both, and initiates coverage on Hargreaves Lansdown (HRGV.L) with a "neutral" rating and 305 pence target price.

HSBC says its strategists expect global equities to post additional gains of 15 percent on average by end-2010, and this scenario is not fully reflected in consensus estimates or sector valuations.

The broker says it favours Schroders and Aberdeen Asset "for the growth potential offered by their asset class and market exposures, and for their relatively defensive business models."

Overall, the broker says the UK asset management sector is inexpensive, trading broadly in-line with its longer-term average price earnings relatives and at a discount to the UK market and a discount to its U.S. peer group.

Shares in Aberdeen Asset gain 0.1 percent, Bluebay is flat, while F&C Asset Management loses 0.3 percent, Hargreaves Lansdown slips 0.1 percent, Henderson falls 1.2 percent, and Ashmore drops 1.6 percent after issuing a trading update on Wednesday.

For more on Ashmore's update, double click on [ID:nLDE60B0NS]

Reuters Messaging rm://jon.hopkins.reuters.com@reuters.net