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@warsaw. It is largely coming off SVB, though continued weakening in the American markets, coupled with Powell's comments saw all the American banks take a major hit yesterday. Barclays off course which prides itself on the transatlantic nature of its operations, which simply means it takes everything that hits the American banks SP in a downturn, but reaps none of the benefits of American banks SP upswings, is taking a further clobbering.
I wonder if Silicon Valley Bank is to blame?
SVB Financial Group (SIVB.O) scrambled on Thursday to reassure its venture capital clients their money was safe after a capital raise led to its stock collapsing 60% and contributed to wiping out over $80 billion in value from bank shares.
https://www.reuters.com/business/finance/silicon-valley-bank-sell-stock-cope-with-cash-burn-2023-03-09/
I've never heard of this bank until I did some investigating into what might have caused yesterday's sell off, I don't know if Barclays have any exposure to this bank, or whether the market is simply responding mechanically by clobbering everything with bank in its name or there's another completely unrelated cause.
The proximity of their issues to Barclay's share price weakening makes it a prime suspect though.
Long way to go but… 152.22p on opening!? Just ripped the curtains off the pole!!!!
Regards MrA
TheReducer - Thoroughly enjoyed reading you post. Well done you and thanks for taking the time to do it. Anyone who has not read it should scroll back. I can see why it received so many recommendations. Regards S
I took some action yesterday, as this was building over the last few days. Most risk is against smaller US regional banks. But the big banks took a hit. Baby thrown out with the bathwater.
Plan to buy more today...
…and who knows where the share price will settle. Curtains violently twitching so much so, that I’m sure I’m sending a message by semaphore!!
Good Luck All, Regards MrA
@badjob. I made the point at the time badjob, but given your comments, I reiterate in support of you. Two days before the last Barcs results I opened a 2-year savings account paying 4.2% a year. My capital in that account remains the same. On Barcs results day, based on the overnight SP of £1.87 (itself a disgrace of a price), the 7.5p total annual dividend equated to a return of 3.8%. Since then my capital has reduced by 13%! And then Venkat, has the gall (on £5m a year or whatever ) to say that he and the board members cannot understand why the SP is so poor and that they spend many hours scratching their heads over it!
are the reason for our downturn today. Buying opportunity IMO DYOR
Strong message to bank from the share price that they need to up their pay-outs to shareholders. Not good enough to lag the rest of the sector when headline profits are pretty good and there has been no make good for dividends lost in covid. Investment case is quite hard if there are not good dividends when profits are high as there is always the possibility of another mess up around the corner. Investment bank is hoovering up too much capital for the returns it is making.
Starting to look oversold. Someone will be accumulating shares here for the bounce. Always difficult to see the bottom but it very near IMO
Hopefully any further SP falls will be minimal once the buy-back kicks in - think it starts on Monday 13th March.
Starting to look like an over reaction on those results. Now looks like a good price for a buy in around these levesl. Can’t see it going much lower given buyback commence shortly regardless of those being 500m. :)
Hi to all below and potential "Curtain twitchers" lol
Just a very quick in and out as otherwise pre occupied this week.
Just adding my paws worth, as previously mentioned it was looking like a sneaky short.
No I didn't post when it triggered my end as I was not taking up the offer myself (First one I let slip in a while) though I if I had I would be closing it now on "Old faithful" the 200.
Did clock the post from The Reducer, think most of us can empathise there.
@Reducer the AGM's a good time to vent your valid opinion, let me know when its you up speaking and ill chuck a few "Here, Here's!" in from the hecklers seating.
Once things for certain I do not know one long term investor that does not feel cheated owning 541t3 Barclays these past years.
GLA and paws crossed for a bounce off the 200.
Barclays must be the worst run bloody bank in the world - what a shower!
Jay K, only rubbing my hands because it is so blinkin' cold!!! Brrrr!!!
Still 'curtain twitching' for a buy. I advised that I had lowered my potential Buy in price. Still looking to buy a big lump, just looking at Financial Calendar Dates amongst many things.
Hope you are well my friend?
Regards, MrA
That was pretty much exactly the number I had in mind too, JayK. Without the buy backs though, not sure I would chance it. Still pondering. Thanks for your thoughts mate.
Powell certainly did affect DOW and FTSE, it happens every time. Within a week we usually have a bounce up as everyone kinda forgets. I certainly do go back and look at what happened at previous news events, if I am going trade one, which I try not too.
@LWHL - BARC looking weak, broke the daily trading range of the last month, FTSE week also, dropped nearly 200 points in the last month, and BARC has suffered, BARC generally drops a higher % when the FTSE drops than other banks it seems. FTSE has an descending triangle forming and is printing a swing low at the previous swing high, so at the mo, its looking like it could break its current up trend, which is not going to help BARC in anyway. 162/163 support for BARC, although we did see a large number of buys come in this week which could of bolstered the price, if that order is filled well we can see whats happening now. Budget brewing also, lets see what happens, I think BARC is nearing a good buy but I'd keep an eye on the FTSE to see if it can hold support too.
Mr A must the rubbing his hands now, I wish I listened to the advice I gave Mr A myself ha!
Right time to go play in the snow with the little one. ATB.
Reducer
Historical share price movements seemed to be the conversation.
@ onelongrunner -"History is never the driver of the future share price". So you don't think yesterday's comments by Powell and what happened to the DOW yesterday, has affected the FTSE today?
The Fed will manufacture a recession to cool inflation, so banks are going to suffer
Even at current bombed out price the yield is only 4.4% which is the lowest in the sector.
I hold NWG & Lloyds permanently.
Barclays i trade , was that not wot i was implying.
Reducer I agree shareholder revolt required. The underperformance of this bank relative to its peers - despite the advantages of its diverse business model and the fact that it makes significant profits in the US which should generally suggest a higher rating - suggests the investment community have a total disdain and lack of trust for the board and management. The fact that the payments to shareholders are materially lower than those from the other banks despite profits being materially higher than those at NWG suggests either a lack of confidence in the banks prospects by the board or a desire to hoard cash to shore up their own bonus pots. The fact the CEO took home £5.2m despite presiding over the fiasco of the notes issuance which should, frankly, have resulted in his resignation, says it all. I think any investors looking at the UK banking sector will think this bank is cheap but until they have confidence that the board have the shareholders interests as a priority, the bank is only investable at a huge discount. I don't think the profit miss was the big thing. It's the paltry £500m buy-back which will do absolutely nothing to move the dial. From what I can see, there has been total silence from the bank following investors thumbs down to its results and strategy. They are probably too busy planning how they can maximise and justify their next round of bonuses because that is their number 1 priority.
This is nowhere near blood on the streets territory! But completely agree with the general notion. Vix still below 20, among other indicators that would suggest the storm has not even started yet. Of course, sometimes it strikes out of nowhere and fast, so this comment may be outdated within a few days or weeks, or even hours :) Or maybe years. I am very good at calling recessions. I have called about five of them since 2011 :)
I bought NWG at £1.09
Lloyds at 24p
Timing = Blood on the Streets !
Might have a gamble on Barcs shortly , traded this reasonably well previously.