LONDON (AFX) - WPP PLC shares were lower in late morning trade, weighed down by a weaker dollar and a Cazenove downgrade, dealers said.

In a note to clients, the UK broker downgraded its recommendation on the media group to 'in-line' from 'outperform' on valuation, arguing that the shares are now trading close to its raised target of 600 pence, up from 580.

Cazenove added that shareholders of its recently-acquired Grey business will soon start to sell their WPP holdings, with up to 82 mln shares flowing back from those who cannot own non-US listed stocks.

Looking ahead, the broker noted that although current trading remains good and it expects the group to exceed its stated target of 13.8 pct operating margins in 2004, it believes that there are a number of negatives looking into early 2005.

By 12.00 pm, WPP shares were down 10-1/2 pence at 579-1/2.

long LAND 1233 s/l on