Something is not right. #financefriday

Sometimes when I’m watching the stock market, I think something is not right. Today, NatWest’s results were out with increased profits. So why is the share price over 6% down? This morning people were selling NWG but this afternoon they are buying the dip. Something else was not right. The market makers tend to have a high spread on risky companies and low on low risk ones. The market makers increased their spread on NWG this morning, now spreads seem to be around 0.07% which is still higher than normal but much lower than this morning. The government owns a big junk of NWG and today’s drop cost the government about a billion pounds. Maybe they have said something quietly that has spooked the market?

Contagion

Contagion happens, and Lloyd’s Banking Group is also down 3.21% despite more people buying than selling. The spread is higher than usual for Lloyd’s too. I don’t want to join the conspiracy theorists, but something is not right, and I expect someone will be buying and making money out of this somewhere.

Barclay’s

On Monday, Barclays dropped sharply too but at least there was an explanation for that. Maybe banks are just out of favour this week? It all seems very strange. It is a good time to buy the dip.

Centrica

Centrica had results out this week and they were bound to be good. I sold Rolls-Royce and bought Centrica, and so far, that seems a good move. I sold the “burning platform” as their CEO described it. I might have kept my RR shares had I known about the “secret talks” to supply engines for Air India. I think the “burning platform” email might deter investors for a while, though and so I’m glad I’m out.

Commodities

With inflation over 10%, I expect gold to be going up at least the same. It seems to be falling this week, which seems strange. Gold appears to be favoured by those who prepare for the worst and build nuclear bomb shelters. If things get so bad that money has no value, then gold will be worth having. I won’t buy into all the conspiracy theories and predictions of doom though

Advertisement