UPDATE 1-Fox-Pitt ups '10 profit view on US asset managers

July 14 (Reuters) - U.S. asset managers may experience higher revenue if equity markets continue to rebound, analysts at Fox-Pitt Kelton said, and raised earnings estimates across the board citing strong market performance in the second quarter.

"We note that the strong performance early in the quarter was already reflected in the numbers. Our 2010 earnings estimates are increasing on average by 13.8 percent," the analysts said.

The analysts upgraded AllianceBernstein Holding LP (AB.N) and Franklin Resources (BEN.N) to "outperform" from "in line", while Janus Capital Group Inc (JNS.N) and T. Rowe Price (TROW.O) were upgraded to "in line" from "underperform."

The analysts said asset managers had cut expenses, making them leaner than they were at the start of the third quarter of 2008, allowing them to get back to higher margins more quickly.

However, the analysts cautioned that poor performance in the equity markets could drive margins lower and cause many investors to pull out of the equity markets.

The analysts downgraded Legg Mason Inc (LM.N) to "underperform" from "in line," saying the company has many issues to work through in the near term.

The brokerage rated U.S. asset managers as a group at "marketweight."

For the alerts, please double click [ID:nWNAB6893] (Reporting by Sakthi Prasad in Bangalore; Editing by Aradhana Aravindan)