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NatWest’s share price has been relatively stable as investors focus on the bank’s strong shareholder returns. The stock closed at 204p, slightly below this month’s high of 215p, and has surged by over 125% from its lowest point last year.
This week, NatWest made headlines by announcing the sale of its Irish business to Allied Irish Banks (AIB). AIB will acquire €5.01 billion in gross performing commercial lending and €2.8 billion in undrawn exposure. NatWest expects to make a modest gain from this transaction.
The stock is also reacting to developments in the banking sector, particularly in the U.S., where banks have announced significant dividend increases following their successful stress tests. For instance, Morgan Stanley and Wells Fargo have doubled their dividends and expanded their share buyback programs. Other major banks like JPMorgan and Goldman Sachs have also announced increased payouts.
Additionally, NatWest’s share price is influenced by the strong performance of the UK housing market. Recent data from the Nationwide Society revealed that house prices have surged to their highest level since 2014. This is particularly relevant for NatWest, a leading mortgage provider in the UK, and increases the likelihood that the Bank of England may adopt a more hawkish stance soon.
On the technical side, the daily chart indicates that NatWest’s share price has been trading within a tight range. The stock has formed a small ascending channel and remains slightly above the 61.8% Fibonacci retracement level. It is also trading above the 50-day and 25-day exponential moving averages (EMA), with the MACD indicator showing positive momentum.
Given these factors, the stock is likely to continue rising, with bulls targeting the next key resistance at 230p. However, there is a possibility that it could pull back to the 50% retracement level at 180p.