Weekly equities outlook: Barclays, NatWest and BP

Barclays Q4 & FY earnings preview

Barclays will report full-year results on Thursday ahead of the market open. It is the first of the UK lenders to report, so results will be watched carefully. Expectations are for a rise in pre-tax profits to £8.1 billion for FY2024, up from £6.6 billion in 2023. Thanks to its strong capital position, investors will be watching for a possible £1.8 billion share buyback.

Barclays results will be driven by its investment banking arm, loan and deposit growth as well as net interest margins, which have risen across the year. While deposits dipped slightly in Q3 the bank is expected to see solid loan growth. Interest rate expectations for 2025 will also be crucial in relating to any guidance net interest income.

Barclays also has strong exposure to investment banking, and given the upbeat results from US rivals, this could help boost Barclays.

How to trade BARC earnings?

Barclays has broken out of its multi-month ridding channel, reaching 307. Buyers are supported by the RSI, while it remains out of overbought territory.

Buyers will look to rise towards 325. Immediate support can be seen at 297 the upper band of the rising channel. Below here, 285, the February low comes into play, and 280, the 50 SMA, and the mid-point of the rising channel.

NatWest Group earnings preview

Nat West will report on Friday, February 14, ahead of the market open. This comes as its share prices have doubled over the past year and are up 8% so far this year, thanks in part to a tailwind from the broader positive mood for UK stocks.

Expectations range for a pre-tax profit of £6.1 billion in 2024, down slightly from £6.2 billion in 2023, with strong loan growth expected to continue. Net interest margins have remained solid in 2024 as interest rates remained elevated. Default rates remain stable, although the economy is stagnating, and recent UK growth forecasts have been halved, meaning there is a risk that lands could turn bad if conditions deteriorate further.

Expectations are for a dividend payout of 19.4p per share and a total cash return of £4.8 billion.

How to trade NWG earnings?

NatWest's share price trades within a rising channel dating back to early 2024. The price continues to hold above the mid-point of the channel, rising to a high of 451.The RSI supports further gains while remaining out of overbought territory. Buyers could look to extend gains towards 470 the uupper band of the rising channel.

Support can be seen at 430, the mid-point of the channel, and 388, the lower band of the channel. A break below 370, the 2025 low creates a lower low.

BP Q4 & full-year earnings preview

BP will release full-year results on Tuesday as the stock price underperforms the broader market.

Oil prices have stayed around the same over the past year, although natural gas has jumped over 50%. Analysts expect an underlying replacement cost after tax, which is the industry’s net income version of $1.3 billion for the quarter, down from $2.3 billion in Q3. This should equate to around $9 billion for the full year, down from $13.8 billion last year.

BP has already flagged a fall in oil and gas prices and low carbon output in Q4 compared to Q3, as well as weak refining margins downstream and unhelpful currency movements. This picture is unlikely to help sentiment. Attention will also be on 2025 output targets and capital expenditure, which is expected to increase to $16 billion in 2024 and flatline in 2025 and 2026.

Shareholders will also be waiting for an announcement on BP's oil and gas production strategy and renewable energy, amid a sense that investors are becoming restless while waiting for clarification on the strategy.

How to trade BP earnings?

After falling to a 2-year low of 365, the price has recovered higher, rising above the falling channel and the 200 SMA to current levels of 435. Buyers, supported by the RSI above 50 will loo to rise above 440, the 2025 high to extend gains towards 460, the late July high ahead of 478.

Sellers would need to break below the 200 SMA at 420, the 200 SMA, and 411, the February low. A break below here creates a lower low and could bring 400 into play.

From time to time, StoneX Financial Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.

City Index is a trading name of StoneX Financial Pty Ltd.

The material provided herein is general in nature and does not take into account your objectives, financial situation or needs.

While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments.

StoneX recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment further CFD investors do not own or have any rights to the underlying assets.

It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.cityindex.com/en-au/terms-and-policies/, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. Our Target Market Determination (TMD) is also available at www.cityindex.com/en-au/terms-and-policies/.

StoneX Financial Pty Ltd, Suite 28.01, 264 George Street, Sydney, NSW 2000 (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.