- Close Brothers share price is on a scintillating sentiment and mid-term momentum could secure the psychological 500p support.
The upbeat momentum on Close Brothers share price has extended into the second day, with the stock up by 1.1% in the early morning session to retest the 500p mark. Close Brothers Group Plc (LON: CBG) and First Rand won a landmark motor finance case at the UK Supreme Court, saving themselves and other UK car loan lenders billions of pounds in compensation claims from buyers.
Last Friday, the UK Supreme Court ruled largely in favour of lenders overturning an appeals court finding of 2024 that had ruled discretionary commission agreements (DCAs) between lenders and dealers were illegal. The ruling by the highest court in the land found that such arrangements were not illegal to the extent that the commissions were not excessive like in the case of appellant, Marcus Johnson’s 55% of the total charge.
However, the ruling also leaves room for relatively smaller claims that could add up to a maximum of £950 per claim as estimated by Financial Conduct Authority (FCA). Nonetheless, it is relatively small and Close Brothers share price will likely take this lifeline, considering that the specialist lender was the most exposed to the pool of 80,000+ potential compensation claims.
That said, today’s modest gains signify that investors are consolidating after Monday’s upsurge, and the upside momentum could slow down. Also, eyes will be on FCA’s upcoming industry-wide redress consultation, and the outcome could inject a fresh impetus into Close Brothers share price.
Close Brothers Share Price Prediction
The momentum on Close Brothers share price calls for further upside above 525p. That will likely translate to further gains that could meet primary resistance at 510p. An extended control by the buyers will breach that level and potentially test the second resistance at 525p.
On the other hand, action below 485p will invite the sellers to take control. In that case, the first support will likely come at 465.2p. The upside narrative will be invalid if the price breaks below that level. Also, a stronger momentum could send the action lower and test 446p.
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