[PC/Gamepad] Can't pickup items with enemies around

Pickup (A by default) button is not highlighted and can't pickup items as long as any enemiy is auto-targeted. Happens all the time since on gamepad you always target some of the enemies in a range. Pickup button being highlighted if moving R-stick is any direction

Perhaps this is something related to targeting settings since my other character does not have such problem. Not always at least.