Goldman Sachs Group Inc.'s stock fell 1.4% in morning trade Tuesday, enough to make it the biggest decliner among Dow Jones Industrial Average components, after Citigroup downgraded the bank on valuation concerns. Analyst Keith Horowitz cut his rating to neutral, after being at buy the last 13 months. On Monday, the stock had run up 3.2% to close at the highest levels since Dec. 30, 2015. Horowitz said the key driver of banks stocks recently has been expectations of rising interest rates, which helps boost the spread between what it costs them to fund assets, such as loans. "However, with the market now pricing in a 80% plus probability of a December rate hike which is embedded in estimates...we don't see significant upside," Horowitz wrote in a note to clients. He said the current valuation of Goldman's stock sets a "relatively high bar," given current estimates. Horowitz also downgraded Citizens Financial Group Inc. and KeyCorp to hold from buy. Goldman's stock has slipped 0.7% year to date, while the SPDR Financial ETF has gained 2.4% and the Dow has climbed 4.5%.
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