Financial Trading Blog

Stock of the day 28/04/2015 – Barclays PLC




After starting 2014 at £2.67, a turbulent 12 months that included increasing accusations over unethical ‘dark pool’ practices saw Barclays close out the year at £2.41. Things have been slightly better for the bank in the New Year; after a sharp, market-wide, fall in mid-January saw the bank trading at £2.20, Barclays managed to reach 10-month highs at the start of March as it hit £2.68. Barclays has by-and-large managed to maintain these levels, despite a wobble towards the end of March, and is now trading at £2.62.

Barclays Chart April 2015
(Source: IT-Finance.com 28/04/2015)

The narrative surrounding Barclays at the moment remains dominated by fines and charges for malpractices. The bank still hasn’t a settlement for the currency-rigging scandal, although a £1.25 billion provision is some indictor of the size of the fine. On top of this, Standard & Poor think that Barclays could still be forced to hand over more in what the rating’s agency is forecasting as a further £19 billion in conduct and litigation fines split between the UK’s big four (Barclays, RBS, Lloyds and HSBC) over the next year and a half.

And there could be more issues on the horizon as well. Last week Barclays failed to get a US fraud lawsuit into its ‘dark pool’ practices dismissed, practices that relate directly to the continually unfolding high-frequency trading scandals. The outcome of this lawsuit could set the precedent for more action elsewhere, and have wide-reaching consequences for the banking sector as a whole.

Yet change could be in the works. Last week Barclays’ shareholders urged the bank’s new chairman John McFarlane to enact a radical overhaul of the problem-ridden institution, with key issues being the bank’s financial performance alongside the perpetual issue of how much the company’s bankers get paid.

The promise of a turnaround in fortunes for the bank has been enough for analysts to give Barclays a consensus rating of ‘buy and a target price of £2.91.



DISCLAIMER


Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 64% of retail investors lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. For professional clients, spread betting and CFD trading can also result in losses larger than your initial stake or deposit.

Spreadex Ltd is authorised and regulated by the Financial Conduct Authority, provides an execution only service and does not provide advice in any way. Nothing within this update should be deemed to constitute the provision of investment advice, recommendations, any other professional advice in any way, or a record of our trading prices. This update does not constitute or form part of an offer of, or solicitation for a transaction in any financial instrument, nor shall it or the fact of its distribution form the basis of, or be relied on in connection with, any contract therefore. Any persons placing trades based on their interpretation of the comments or information within this update does so entirely at their own risk.

No representation, warranty, or undertaking, express or limited, is given as to the accuracy or completeness of the information or opinions contained within this update by Spreadex Ltd or any of its employees and no liability is accepted by such persons for the accuracy or completeness of any such information or opinions. As such, no reliance may be placed for any purpose on the information and opinions contained within this update.

The information contained within this update is the intellectual property of Spreadex Ltd and is protected by UK and International copyright laws. All rights reserved. Users may however freely download, distribute and reproduce extracts of the contents, subject always to accrediting Spreadex Ltd as the source and providing a hyperlink to www.spreadex.com.