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Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

Why is the Lloyds share price in freefall?

The UK lender has seen its share price tumble more than 20% since the beginning of the year, though the stock has found support at 48p on Monday, with analysts from Barclays Capital hopeful its value will rise in 2020.

Lloyds shares have been in freefall since the start of the new year, with the stock tumbling 22% year-to-date, with the lender forced to make significant strategic changes in response to a challenging banking environment throughout 2019.

‘Given our clear UK focus, our performance is inextricably linked to the health of the UK economy,’ Lloyds CEO António Horta-Osório said. ‘Throughout 2019, UK economic performance has remained resilient in the face of significant political and economic uncertainty, supported by record employment, low interest rates and rising real wages.

‘Although uncertainty remains given the ongoing negotiation of international trade agreements, there is now a clearer sense of direction and some signs of an improving outlook,’ he added.

Lloyds closed at 49p a share on Monday.

Looking to trade Lloyds and other UK bank stocks? Open a live or demo account with IG today.

Barclays Capital upbeat about Lloyds price trajectory

Despite Lloyds challenging start to 2020, the stock has finally found support at 48p levels, with analysts from Barclays Capital remaining optimistic about its trajectory this year.

In March, analysts from Barclays Capital reiterated their ‘overweight’ rating for Lloyds and despite downgrading their target price to 70p a share, it still represents a potential upside for the stock of 42.8%.

You can go long or short Lloyds with IG using derivatives like CFDs and spread bets.

Lloyds: technical analysis

Lloyds has seen an impressive bounce from support, as the rout in the share price since mid-December comes to a halt at 48p. This level held back in August, and then provided the foundation for a remarkable surge, to a high of 70p by December, Chris Beauchamp, chief market analyst at IG said

‘While history may not repeat itself, the price is certainly fighting to move higher, even if the initial rally on 2 March was firmly knocked back,’ he said.

‘So long as it continues to hold at 48p, a more cautiously bullish view may emerge. If 48p is lost, then the December 2018 low at 46.8p comes into play. For now, the long-term range of 48p – 70p continues to hold,’ he added.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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