Stock update: Nokia hit by Merrill Lynch downgrade
Nokia the largest phone manufacturer in the world saw its stocks (NYSE:NOK) trade up 1.9 percent, underperforming the 5.1 percent stronger DJ Stoxx technology index, this rate drop came as Merrill Lynch downgrades Nokia on its recommendation from “buy” to “neutral” on the back of its exposure to market recession.
Merrill Lynch stated in its note on the cell phone giant “Nokia is not exposed to the credit crunch, but it is exposed to the potential recession that follows”.
The note continued to say ‘we lower our 2009 handset market growth from 4 percent to (a drop of) 5 percent, driven by consumers holding on to their phones for an additional seven months on average globally.’
As the much talked about Nokia 5800 XpressMusic is launched around the world, we ask will this be enough to push the Nokia share recommendation from Merrill Lynch from “Neutral” to “Buy” again. With all the present activity in the touchscreen smartphone market as well as the holiday period drawing closer Nokia would be in line to receive positive stock results.