Shares of Goldman Sachs Group Inc. climbed 0.7% and Morgan Stanley jumped 1.7% in morning trade Monday, bucking the selloff in the broader market, after Evercore ISI upgraded the brokers, saying the recent selloff in the stock have made their valuations attractive. The S&P 500 was down 0.6%. Analyst Glenn Schorr raised his ratings on both brokers to buy from hold, bringing their ratings in line with the other banks/brokers he covers. "When you feel like crying, it's time to start buying," Schorr wrote in a note to clients. Over the past three months, Goldman's stock has lost 7.9% and Morgan Stanley's has dropped 11%, while the SPDR Financial ETF has declined 6.9% and the S&P 500 has shed 6.2%. "While the third quarter could be a tough one given the beat down in global equity markets, wider credit spreads, lower oil prices and seasonality in underwriting, it ain't over yet as the bright side to the recent pick up in volatility has been higher trading volumes in fixed income and equities and even retail got a boost in what is typically...the slowest summer month," Schorr wrote. Separately, Schorr had upgraded J.P. Morgan Chase and Bank of America to buys in January 2015, and placed a buy rating on Citigroup in October 2014.
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