- Summary:
- Barclays share price has strong traction to stay up, with impressive financials and supportive business environment. But there's more.
Barclays share price has been on the uptrend in November, but its gains have slowed down this week. After gaining 8.8 percent in the last month, many investors can’t help but wonder if this is a window of opportunity to buy the stock. Also, Barclays (LSE: BARC) has gained 68.6 percent year-to-date, meaning some may consider the current price level as too high.
BARC was up by 0.7 percent at the time of writing and traded at GBX 259.35. The Bank has registered back-to-back quarterly earnings week in each of the three quarters reported so far in 2024, providing strong traction for an upbeat performance outlook. With a P/E ratio of 8.9, against the FTSE 100’s average of 15.1, Barclays is fairly valued.
The UK banking industry faces a monster car finance scandal which, could cost lenders upwards of £20 billion in redress claims. However, for its size, Barclays is less exposed to a potential financial downturn, having closed down its motor finance business in 2019. That could leave it at a better place than Lloyds and Natwest, which is good for BARC share price.
Elsewhere, UK consumer inflation rate rose to 2.3 percent, in October, exceeding the median forecast rate of 2.2 percent. That marked a return above the Bank of England’s target of 2.0 percent, after the rate previously fell to 1,7 percent in September. That spells good news for Barclays share price, as it raises the prospect of a lower interest cut by the BoE in its December MPC meeting. That is good for banks, as it offers them a higher net interest rate margin, translating to increased profitability.
Barclays share price prediction
Barclays share price pivots at 259.30, and the buyers will be in control if action stays above that level. The upside will likely meet initial resistance at 261.40, but a stronger momentum could break through that barrier and test 263.40.
Alternatively, moving below 259.30 will strengthen the sellers to take control. If that happens, the first support is likely to be at 256.00. In addition, if the sellers extend their control, the price could break below that mark and render the upside narrative invalid. Also, that could send the price lower to test 253.85.
