In the face of a significant slowdown in underwriting, analysts are suggesting that U.S. investment houses expand their retail brokerage business overseas.

Players that concentrate on the domestic market, like Charles Schwab Corp., may be left behind if they do not expand, wrote Henry H. McVey, an analyst at Morgan Stanley Dean Witter & Co. in New York. “Clearly the opportunities in the United States are significant,” Mr. McVey wrote. “But we believe that management should and could be moving aggressively overseas.”

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