Barclays announced on Friday that it had downgraded its recommendation on Ericsson shares to 'underweight' from 'in-line weighting', with a price target lowered from SEK 65 to SEK 55.

The broker explains that it is concerned about the health of the market after telecom equipment manufacturers' activity in radio access networks (RANs) fell by almost half last year in North America.

We believe that this down cycle is not over, with 5G base station data pointing to a major slowdown in India", explain Barclays analysts.

From the research firm's point of view, AT&T's recent decision to opt for 'open' network technologies (Open RAN) risks posing long-term structural problems for the sector.

In view of this context, Barclays has also decided to downgrade its recommendation on Finland's Nokia to 'underweight'.

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