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NEW YORK (Reuters) -- Wall Street is still advising
investors to buy shares of ailing companies even as
they file for bankruptcy, according to a study
released on Monday.

Weiss Ratings, a market research firm, said it found
that 46 of the 62 brokerage houses covering companies
that filed for bankruptcy between May 1 and Aug. 31
continued to recommend buying or holding those
shares as the companies filed Chapter 11.

Nineteen of the 54 publicly-traded companies that
filed for bankruptcy during the four-month period
received a total of 126 ratings from the brokerage
firms covered in the Weiss study. On the date of
the bankruptcy filing, 28 ratings for these
companies were to buy their shares, and 56 ratings
were to hold the shares, according to the study.

"Given the highly misleading ratings still being
disseminated by the brokerage community, it's
no wonder investor confidence in the markets r
emains so low," Weiss Ratings President David
Lackey said in a statement.

Nonetheless, the firm said, the percentage of
"buy" or "hold" ratings issued for failing companies
did decline to 66.6 percent from 90.9 percent in the
first four months of this year.