Jefferies downgraded to Underweight from Equal Weight at Morgan Stanley

Morgan Stanley downgraded Jefferies Financial Group to Underweight from Equal Weight with a price target of $27, down from $28, after assuming coverage of the name. As Jefferies exits merchant banking, its mix shift toward investment banking and markets, driving up its comp ratio to a 52%-54% range, the analyst tells investors in a research note. The firm says higher macro uncertainty and higher recession risk will weigh on the company’s business mix. The downgrade is "tactical in nature and reflective of the environment we’re in," writes Morgan Stanley.