LONDON (ShareCast) - UBS has lowered its rating on Old Mutual to ‘neutral’ from ‘buy’ and cut its target price to 108p from 132p, following the South Africa-exposed insurance company’s interim results last week.

The broker said investors’ confidence in the company will be reduced after Old Mutual’s increased $125m provision.

Restructuring will now be needed for UBS to lift its rating on the company again, it said.

The experience of the US does not bode well for the UK newspaper sector, JP Morgan said as it lowered its rating on Trinity Mirror to ‘underweight’ from ‘neutral’.

The broker expects steep declines in national and regional advertising to continue hurting Trinity Mirror, which publishes local papers such as The Birmingham Post as well as its flagship title the Mirror.

“National newspapers have poor bargaining power with advertisers due to intense competition and the rise of the internet – where advertising at 19% of the UK total is the highest in the western world,” JPM said.

JPM remains ‘overweight’ on Daily Mail publisher DMGT due to its exposure to specialist business publications and keeps its ‘underweight’ stance on Yorkshire Post publisher Johnston Press.

“The current cycle will punish Johnston's local classifieds business, though we see relative upside at the other end of this tunnel if regional newspapers can retain local (higher priced) advertising,” it said.

Merrill Lynch predicts a worsening trading environment for Speedy Hire over the next couple of years and downgrades its rating on the tool hire specialist to ‘neutral’ from ‘buy’.

The broker lowered its 2009 earnings per share forecasts by 3.8% and 2010 earnings by 13.1%.

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