Sector movers: StanChart and Barclays give banks a boost
Decent gains from the likes of Standard Chartered and Barclays drove the UK banking sector higher on Wednesday.
Banks
3,996.57
17:09 24/04/24
Barclays
191.14p
17:15 24/04/24
FTSE 100
8,040.38
16:34 24/04/24
FTSE 250
19,719.37
17:09 24/04/24
FTSE 350
4,419.71
17:09 24/04/24
FTSE All-Share
4,374.06
16:44 24/04/24
HSBC Holdings
663.60p
16:35 24/04/24
Lloyds Banking Group
51.78p
16:40 24/04/24
NATWEST GROUP
285.90p
17:15 24/04/24
Standard Chartered
679.20p
16:35 24/04/24
TSB Banking Group
339.00p
16:34 27/07/15
Emerging markets-focused lender Standard Chartered was rising 4.3% in afternoon trade despite announcing that adjusted pre-tax profits in 2014 dropped 25% to $5.2bn as operating income fell 2% to $18.23bn.
Results missed analysts’ forecasts by a long way due to higher-than-expected costs and impairment, though the market gave the report a warm welcome as the bank eased concerns by maintaining its dividend and not signalling any intention to raise capital.
It also published a list of enhanced financial targets focused on improving cost efficiency, capital management and returns, the analyst pointed out.
Gary Greenwood from Shore Capital said: “The introduction of more aggressive action on costs and capital should be welcomed by the market, while the fact that the company has been able to maintain the dividend and is not signalling any intention to raise equity are also positives for the investment case.”
Meanwhile, analyst Ian Gordon from Investec kept a ‘hold’ rating on the stock but said the shares remain “materially cheap if it chooses to avoid what we regard as an unnecessary and value-destructive capital raise that the market generally believes is coming”.
Barclays was up 2.6% after UBS reiterated its ‘buy’ rating for the bank, telling investors to expect a “continued re-rating”.
The broker cut its target price from 305p to 295p to reflect lower-than-expected fourth-quarter profits from Barclays reported on Tuesday, but said that the stock’s current valuation remains “unchallenging”.
Others in the sector were also making gains, including HSBC, TSB and RBS, while Lloyds was flat.
Top performing sectors so far today
Media 7,268.08 +1.13%
Banks 4,379.29 +0.99%
Industrial Transportation 2,782.03 +0.83%
Fixed Line Telecommunications 5,163.82 +0.66%
Health Care Equipment & Services 6,611.47 +0.55%
Bottom performing sectors so far today
Oil Equipment, Services & Distribution 17,795.31 -2.72%
Mining 14,616.72 -2.14%
Industrial Engineering 9,080.85 -1.86%
Electricity 9,204.37 -1.67%
Gas, Water & Multiutilities 5,742.51 -1.44%