MARKET REPORT: NatWest feels heat from brokers over bleak outlook

After a summer of suffering, NatWest suffered further pain in a brutal start to the week.

After facing a wave of criticism over their Coutts division’s “de-banking” of Nigel Farage – which cost chief executive Dame Alison Rose her job – brokers sounded the alarm about the bleak outlook.

Analysts at Citi, Barclays, RBC, Berenberg and JP Morgan lowered their price targets on the stock.

And Jefferies lowered its rating to “Underperform” from “Buy.”

This comes after third-quarter results fell short of market expectations on Friday and led to the biggest fall in stocks since Brexit.

Shares in the red: Natwest is once again in the firing line today as a number of the City’s leading brokers sounded the alarm over the bleak outlook

The City is concerned that NatWest’s net interest margin (NIM) – a measure of the difference between what it pays out to savers and what it charges borrowers – will fall further this year.

Berenberg’s Peter Richardson was concerned about the scale of the reduction, while analysts at JP Morgan added that there was a “high degree of uncertainty” for UK banks about whether and when NIM will stabilize.

NatWest fell 2.1 percent, or 3.85 pence, to 178.15 pence, widening its annual loss to almost a third.

The FTSE 100 rose 0.5 percent, or 36.11 points, to 7,327.39, while the FTSE 250 rose 0.9 percent, or 151.36 points, to 17,017.59.

Asos made gains after reports emerged that the online fashion giant was in talks to sell Topshop to the owner of Forever 21 and Ted Baker. Shares rose 0.7 percent, or 2.5 pence, to 388.1 pence.

Commodities trading and mining giant Glencore cut its nickel production forecasts but maintained its forecast for copper, zinc, coal and cobalt production and said it was on track to post a profit of 2.9 billion pounds to 3.3 billion pounds in its commercial department.

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Inspecs recouped some of its losses after the eyewear company benefited from higher sales of glasses and lenses.

Bath Group’s turnover rose 4.6 per cent to £159.1 million in the first nine months of 2023 and it is confident full-year results will be in line with market expectations.

The production site in Vietnam, which began construction in May, is expected to be completed in the first half of next year.

The shares, which traded at 195p in February 2020 and peaked at 408p in January last year, rose 10 per cent, or 7p, to 77p.

It rose 1.3 percent, or 5.75 pence, to 4,515 pence. Airtel Africa’s revenue rose 19.7 percent to 2.1 billion pounds in the six months to September 30 as the telco’s customer base grew by almost 10 percent. Shares rose 4.6 percent, or 5.1 pence, to 114.9 pence.

IT group Computacenter said its strong performance in Germany and the US contrasted with difficulties in the UK in the third quarter, where it rose 0.5 per cent, or 12p, to 2,520p.

Digital 9 Infrastructure, which invests in data centers and wireless networks, rose 11.4 percent, or 4.6 pence, to 44.8 pence as the company insisted it was working to “maximize shareholder value” under pressure from investor Aqua Ventures. to work.

However, AJ Bell took the opposite tack as analysts feared the investment platform was among the “most at risk” to margin risks as pressure grows to pass on higher interest rates to customers.

Citi downgraded the stock to neutral from buy and cut its price target by 110p. Shares fell 2.1 percent, or 5.4 pence, to 252.6 pence.

It’s been a long week for Upland Resources. Shares rose 80 percent on Monday last week after the oil and gas company rejected a £154 million takeover proposal.

But the share price plunged 41.3 percent, or 1.86 pence, to 2.64 pence after it was revealed that he and the takeover panel concluded the offer was “not serious”.

There was good news for RBG after the professional services group resolved a dispute with former boss Nicky Foulston, who was sacked at the end of January.

Claims against RBG totaling more than £1.2 million were settled for £500,000.

It rose 2.4 percent, or 0.5 pence, to 21 pence. Cake Box remained unchanged at 132p after Martin Blair, who has been on the board since listing in June 2018, was hired to replace Neil Sachdev as chairman.

Sanderson Design Group, which owns seven luxury home furnishings brands, has signed a licensing agreement that will see Habitat, owned by Sainsbury’s, produce products such as mugs and tea towels based on designs inspired by landscapes and nature looked after by the National Trust.

Sanderson rose 3.9 per cent, or 4p, to 107p.