The Barclays share price soared yesterday after the UK announced the progress of its vaccination program. The stock soared to 153p, which is 18% above the year-to-date low of 130p. Other banks like Lloyds and NatWest also continued to rally.
Barclays news: The biggest catalyst for the recent price action of the Barclays share price is news that the UK had managed to vaccinate more than 15 million people in the past two months. This makes the country one of the highest performers in terms of vaccine rollout.
This is important news for Barclays because it means that the country will likely have a swift recovery. As a result, the Bank of England will likely not push interest rates to the negative zone in the near term. Such rates would have hurt the bank’s mortgage and card business in the UK.
BARC share price is also rising ahead of the bank’s earnings that will come out on Thursday this week. Analysts believe that the bank will do relatively well based on how similar banks performed in the fourth quarter. For example, many banks like Deutsche Bank, Credit Suisse, and UBS recently released strong results.
Similarly, in the United States, banks like Morgan Stanley and Goldman Sachs also released strong results, helped by their trading divisions. Therefore, there is also a problem that the bank’s earnings will equally be strong. Also, based on its strong balance sheet, there is a possibility that the bank will increase its payouts to investors.
In my latest prediction of Barclays stock, I noted that the stock would likely bounce back, with bulls targeting the important resistance at 160p. Since then, the shares have bounced back but they are still short of my earlier prediction. Still, the set-up seems perfect, with the shares being above the 25-day and 15-day exponential moving averages (EMAs) and the 62.8% Fibonacci retracement level. Therefore, my case for the shares jumping to 160p is still valid.
