Analyst Goes Neutral On Capital Market Banking Group

Shares of big banks have seen major gains in the past year, but now may have nowhere to go in the short term, according to an analyst Wednesday. Deutsche Bank's Matt O'Connor cut his rating to Hold, from Buy, on both Goldman Sachs Group Inc

and Citigroup Inc

. O'Connor also lowered his overall rating on capital market banks to Neutral, from Overweight. "We see less upside in the near term," said O'Connor, who noted that a year ago he raised his rating on the group in the belief that that an improving economy would boost revenue and lift sector stock prices. "This has occurred, for the most part," according to O'Connor. The KBW Bank Index

is up more than 11 percent in the past year, with a number of its components seeing double that gain, according to O'Connor. Fed officials seem in no hurry to raise rates, while bank results are likely to be weighed down by seasonally slower business in the second half of the year. But O'Connor reiterated Buy ratings on four big banks where he believes cost cutting can continue and which may post wider-than-expected net interest margins. Those "top picks" include Bank of America Corp

JPMorgan Chase & Co.

M&T Bank Corporation

and SunTrust Banks, Inc.

.