Barclays Share Price Drop Amidst ETNs Controversy

Summary:

Today'strading session has seen Barclays' share prices continue losing in the market. Since March 17, Barclays has lost 20 per cent.

Today’strading session has seen Barclays’ share prices continue losing in the market. Since March 17, Barclays has lost 20 per cent of its value, and there is a high likelihood that the bearish trend will continue.

Part of the reason that Barclays is losing in today’s trading session is due to reports that the company is expected to lose $450mn as a result of Exchange-traded note it exceeded trading by $15.2bn. Reports indicate the company only had the approval of $20.8 billion. However, it ended up not following the regulatory approval recommendations. As a result, they added over $15 billion from the recommended $20.8 billion and will now have to buy the excess ETNs at a loss of $450 million.

The controversy has seen investors question why such a mistake was possible. This has included calls from some shareholders and investors for the lender to claw back or cancel bonuses to finance chief Tushar Morzaria in the wake of the mistake. The hundreds of dollars mistake may have also contributed to the current downward move of the stock.

Fortunately, Barclays is a top-performing company with strong financial yearly reports. In 2021, the company had a net income of over six billion pounds. The company also had a revenue of over 28 billion pounds. Therefore, the company is likely to come out of the $450 million mistake unscathed in the long run.

The Barclays share has already dropped by more than a percentage point in today’s trading session. In the last week, the prices have also dropped by eight per cent. The Williams Alligator lines show a strong bearish move in the daily chart below. The chart also shows a strong momentum to the downside.

Therefore, my Barclays share price prediction is I expect the prices to continue with their current trend until they hit the $132 support level. There is also a high likelihood that the prices may fall below the support level.