The US defence sector is now in slowdown mode, according to a leading Wall Street bank which, as a result, has downgraded its calls on shares two UK contractors.
JP Morgan has cut its recommendation on BAE Systems PLC (LSE:BA.) to ‘underweight’ from ‘equal-weight’ and has done the same for QinetiQ Group PLC (LSE:QQ.).
Stock in the former was off just under 1%, while the latter was down 1.8%.
JPM reckons BAE has 45% exposure to the US market, while QinetiQ’s is 17%.
It retained its ‘overweight’ call on Babcock PLC.