Lloyds share price outperforms ahead of BoE stress test results

UK lenders expected to pass latest health check

Lloyds share price outperforms ahead of BoE stress test results

Shares in Lloyds Banking Group (LON:LLOY) have climbed higher in London in today’s session, ahead of the Bank of England’s (BoE) latest stress test results. The results, scheduled to be announced at 16:30 GMT, will come after the bailed-out lender and FTSE 100 peer Barclays (LON:BARC) emerged as some of the worst performers in the latest European Union stress test, which measured the lenders’ resilience to a set of adverse shocks, including a disorderly Brexit. 

As of 14:17 GMT, Lloyds’ share price had given up 0.83 percent to 56.86p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.1 percent higher at 7,023.61 points. The group’s shares have lost more than 12 percent of their value over the past year, as compared with a near six-percent rise in the Footsie.

Investors await BoE test results

Shares in Lloyds have been in demand ahead of the BoE stress test results, due out at 16:30 GMT today. The bank said last week that it would bring forward the publication of the results following a request from MPs.

“After last year’s clean sweep it would be a surprise if any of the seven UK lenders tested were to fail the latest annual test, but whether it does their share prices any good is a different matter,” AJ Bell investment director Russ Mould commented, as quoted by Proactive Investors, adding that Lloyds and FTSE 100 peers RBS (LON:RBS), Barclays (LON:BARC), HSBC (LON:HSBA) and StanChart (LON:STAN) had “a common equity tier 1 capital (CET1) to risk-weighted-assets (RWA) ratio well above 10 percent, well above that end-2019 target of 4.5 percent stipulated by European regulations”.

Analyst ratings update

Goldman Sachs, which rates Lloyds as a ‘sell,’ set a price target of 56p on the shares last week. According to MarketBeat, the blue-chip group currently has a consensus ‘buy’ rating and an average price target of 77.29p.

As of 14:52 GMT, Wednesday, 28 November, Lloyds Banking Group share price is 56.72p.

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