Franklin Resources Inc. (BEN), manager of the Franklin and Templeton mutual funds, fell the most in more than two months after assets under management declined in December.
Franklin dropped 5 percent, the most since Nov. 9, to close at $96.67 in New York trading. Assets under management declined to $670.3 billion at the end of December from $675.8 billion in the previous month, San Mateo, California-based Franklin said yesterday.
Global bond assets, the key driver in Franklin’s growth over the past two years, declined to $174.7 billion from $179.4 billion on Nov. 30. Investors pulled $1.8 billion from the $58 billion Templeton Global Bond Fund in November and December, the first redemptions in three years after performance lagged behind rivals, according to data compiled by Morningstar Inc. (MORN) The fund attracted $15 billion in net deposits in the first 10 months of 2011, according to the Chicago-based research firm.
A reversal in the growth of global fixed-income products “could greatly impact results negatively,” Jonathan Casteleyn, an analyst with Susquehanna International Group LLP, wrote in a note to clients yesterday. He maintained his “neutral” rating on the stock.
Franklin was cut to “market perform” from “outperform” by Robert Lee, an equity analyst at Keefe, Bruyette & Woods. It was cut to “neutral” from “buy” by William Katz, an analyst with Citigroup Global Markets Inc.
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