Banking shares bolster FTSE 100…except for RBS
Banks' investors have a reason to celebrate this morning, as share prices among lenders are on the rise – with the exception of RBS.
At time of writing, Barclays is the biggest riser of the FTSE 100, while shares in HSBC, Standard Chartered and Lloyds Banking Group are also up, after the Bank of Japan offered some hope to banks around the world by opting to leave interest rates alone but introducing a new target for government bonds and renewing its commitment to its money printing programme.
Shares in Barclays are currently up 3.5 per cent at 172.30p, while shares in HSBC are up 0.7 per cent at 587.50p, Lloyds Banking Group is up 2.1 per cent at 57.60p and Standard Chartered is up 0.9 per cent at 632.2p.
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"Central banks were, according to the script, supposed to be edging away from more stimulus," said Chris Beauchamp, chief market analyst at IG. "The Bank of Japan has proved this theory to be incorrect; while it didn't go for the 'shock and awe' approach it has made a remarkably open-ended commitment to its own version of 'whatever it takes'."
RBS, however, is the odd one out in the field, currently trading down 0.8 per cent at 182.2p. Yesterday evening, it emerged that Santander had called time on talks to take Williams & Glyn off of its hands.
"RBS is very much languishing," said Henry Croft, research analyst at Accendo Markets. "While peers are enjoying another round of drinks at the accommodative policy party, RBS is being turned away at the door."
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RBS has been told to divest itself of the challenger bank by the end of 2017 as part of the terms of its state bailout deal, but warned back in April it might not be able to meet the deadline.
Meanwhile, banks across Europe more broadly have also reacted favourably to the news from Japan. The Euro Stoxx 600 banks index is currently up 2.2 per cent, although it is still 21.8 per cent lower compared with the same time last year.