Barclays Share Price Slumps Amid Bond Trading Loss Disclosure

This Tuesday, the Barclays share price was hit by a double portion of negative news, sending the stock sharply lower in Tuesday’s trading session. The Barclays share price tumbled nearly 4% on Tuesday after a top investor in the stock sold his holdings. The unnamed investor put up about 575 million shares for sale on Monday evening in a sale process facilitated by Goldman Sachs. The total value of the sale equalled 3% of the bank’s shares. 

The sale by the investor was apparently triggered by the bank’s disclosure of a trading loss, which has once more highlighted new compliance failings and poor risk management practices. Barclays bank said it had lost 450 million pounds on mishandled sales of bond products in the United States. 

Securities sold around a structured product exceeded allowed registered amounts, necessitating their repurchase at the original price. The loss means that the planned 1 billion pound share repurchase program the bank had scheduled looks set to suffer a delay. It had been scheduled to hold in the second quarter of 2022.

Regulators are said to be studying the situation closely. The Barclays share price is presently leading the losers’ chart on the FTSE 100 index.

Barclays Share Price Outlook

The bearish gap created by the after-hours sale of the Barclays stock has violated the 156.92 support level and looks set to test the 147.48 pivot. If this pivot breaks down, the door opens for a further decline towards 132.92 (29 January 2021 low) and possibly 121.94 (13/20 July 2020 high).

On the flip side, a bounce on the 147.48 price pivot allows for a potential recovery towards 156.92. 161.62 and 170.34 are additional northbound targets that only enter the picture if the 156.92 support level is removed by bullish pressure. 

Barclays: Daily Chart

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