The latest Market Talks covering Financial Services. Exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.

0758 GMT - Legal & General Group has weaker-quality earnings while competition intensifies in the U.K. pension risk transfer market, Citi's Alejandra Chavez says. Higher competition in the market is driving margin compression, lower pension buyout volumes and tighter credit spreads, causing Citi to take a "cautious stance". L&G also has the lowest operating profit and earnings per share annual growth expectations through 2028 compared to peers in the U.K. life insurance sector, based on Citi's forecast and consensus estimates. "Our valuation frameworks broadly point to fair value below the current share price implying risk-reward ratio skewed to the downside," Chavez writes. Citi reiterates its sell recommendation with a target price of 248 pence, up slightly from 245 pence. Shares rise 0.1% to 297.10 pence. (michael.hennessey@wsj.com)

0711 GMT - Julius Baer Gruppe should be able to move back to business as usual after the end of a probe by Switzerland's financial regulator, RBC Capital Markets' Anke Reingen and Susana Cruz write. The regulator, Finma, ended its enforcement proceedings and says the Swiss bank's CET1 requirement will increase to 9.4%, compared to the bank's latest ratio of 18.5%. The end of the probe should remove some of the discount on Julius Baer's shares due to a "manageable" outcome, RBC says. It should also lower the cost of equity. "Gradually JB should be able to move back to business as usual as other restrictions are lifted," the analysts add. (michael.hennessey@wsj.com)

0707 GMT - Demand for euro-denominated bank bonds eases off due to investor caution as bond market volatility rises, ABN Amro strategists say in a note. Investors are demanding a higher premium to buy bank bonds, causing issuers to reduce supply, the strategists say. "This week, no new euro bank bonds have yet come to the market, suggesting issuers have shifted in wait-and-see mode." (miriam.mukuru@wsj.com)

0656 GMT - Julius Baer Gruppe should benefit from the end of a probe by Switzerland's financial regulator, which removes an overhang on the lender's stock, J.P. Morgan's Amit Ranjan and Kian Abouhossein write. The regulator, Finma, noted shortcomings in credit-risk management but acknowledged measures taken by Julius Baer to address the shortcomings. The measures taken by the Swiss company's management so far are key to avoiding a repeat of previous issues, the analysts agree. Julius Baer also requests approval for a share buyback program, which JPM sees as a positive signal. The end of the probe shifts focus back to the bank's operational performance, JPM adds. (michael.hennessey@wsj.com)

0639 GMT - S&U's performance in the first half was resilient with a strong result for the Advantage Finance business, Berenberg analysts write. The lender is likely to deliver a second half-weighted operating performance this year, Berenberg adds. However, the delay to confirmation of a new funding facility will generate a small drag on interest expense, the analysts add. As a result, Berenberg trims its adjusted pretax profit expectations to 34.1 million pounds from 34.9 million pounds. This won't have a material impact on book value per share for 2028, the analysts note. Therefore, Berenberg doesn't make any changes to its price target of 2,310 pence. Shares closed at 1,965 pence on Monday. (michael.hennessey@wsj.com)

0117 GMT - The sharp repricing of Malaysian Government Securities might add another headwind to banks' 2H noninterest income, but the earnings and book-value impact could remain manageable, Hong Leong IB analyst Raymond Ng says in a note. The 10-year MGS yield has risen to 3.94% from 3.60% at end-June, with further volatility possible if U.S. rates remain elevated, he notes. Higher yields should eventually support investment income as banks reinvest maturing securities, but this benefit will take time to materialize, he says. AMMB and Bank Islam Malaysia are relatively more exposed to potential earnings pressure, while Bank Islam, AMMB and Public Bank have higher sensitivity to book value, he adds. Hong Leong keeps a neutral rating on Malaysia's banking sector, pegging Public Bank as 4Q's top pick. (yingxian.wong@wsj.com)

0059 GMT - Pinnacle Investment Management's underlying momentum seems intact and the recent pullback in its share price is seen by its new bulls as a buying opportunity. Raising their recommendation on the Australia-listed stock to buy from neutral, UBS analysts tell clients in a note that valuation looks attractive at 12.7 times fiscal 2028 earnings, which represents a 40% relative discount to its historical multiple. They acknowledge some risk from changed valuation assumptions at the listed vehicles managed by private lender Metrics, which is 35% owned by Pinnacle, but believe that any impact has been more than priced in. UBS trims its target price 5.6% to 17.00 Australian dollars. Shares are up 8.4% at A$14.01. (stuart.condie@wsj.com)

1702 GMT - There are expansion and consolidation opportunities in the retirement income market as AI improves drug discovery and development and ultimately boosts life expectancy, Morgan Stanley analysts write in a note. "As individuals spend more years preparing for and living in retirement, we expect the retirement value chain to extend beyond accumulation toward solutions that combine investment management, sustainable income, longevity protection and advice," the analysts write. The current fragmented nature of the retirement income market creates room for innovation, partnerships, and consolidation as AI's impact on longevity becomes increasingly clear. They name BlackRock. Apollo, LPL Financial Holdings, and Raymond James as among the possible beneficiaries of this shift. (elias.schisgall@wsj.com)

1700 GMT - Life insurance providers should benefit from AI-fueled drug development improving overall life expectancy, Morgan Stanley analysts write in a note. "Given the current state of drug developments, scientific advances and other factors, we expect life expectancy in the US could improve faster than the historical average of 2 years every 10 years," the analysts write, adding that the trend should support earnings per share benefits for life insurers including Globe Life, RGA, Lincoln, MetLife, and Unum. "This is due to lower benefit ratio for various insurers into the outer years as mortality and longevity impacts become more visible," they write. Insurers with more exposure to morbidity and retirement could see a smaller tailwind, they add, as the expected improvement in longevity cuts both ways. (elias.schisgall@wsj.com)

1136 GMT - The Swiss upper house's decision to tighten capital rules represents a near worst-case scenario for UBS Group, RBC Capital Markets' Anke Reingen and Sherry Lin write. RBC calculates an earnings per share hit of 9% from last week's parliamentary vote to require 90% CET1 backing--only 0.3 point better than the worse option of full CET1 backing. "As the base case is clearer now, UBS might look into finalizing mitigation plans--we do not believe selling itself/part of the operations are preferred options--but we don't expect any disclosure to the market before the finalization of rules," the analysts add. RBC slightly lowers its estimates after company comments that suggested a larger slowdown than it had modeled. Shares are up 0.2%. (michael.hennessey@wsj.com)

1048 GMT - Ethereum falls as elevated Treasury yields and the prospect of tighter monetary policy reduce risk appetite, Zaye Capital Markets analyst Naeem Aslam says in a note. Restrictive macroeconomic conditions are offsetting inflows into ethereum exchange-traded funds and renewed ethereum accumulation by large holders of the cryptocurrency, or whales, he says. "Recent technical analysis has identified the $2,560-$2,565 area as an important support zone, while a sustained move higher would require ethereum to reclaim and hold above the upper-$2,700 area." Ether falls 1.4% to $2,648, LSEG data show. (renae.dyer@wsj.com)

1037 GMT - Tokenization, which creates digital units of value on a blockchain to represent ownership of an asset, offers operational efficiencies but also faces some limiting factors, HSBC digital asset analysts say in a note. This only makes sense if it brings demonstrable advantages over the current way of issue, trading and redeeming assets, they say. The benefits of tokenization include faster settlement times, 24/7 trading, less reconciliation, greater programmability, lower minimum investment sizes and potentially wider and more continuous market access, they say. Challenges include risks related to the technology underpinning tokenization, legal enforceability and limited secondary market liquidity, they say. "For now, tokenization therefore must coexist with much of the legacy financial infrastructure it ultimately seeks to improve."