Asian equities began the week on a subdued note as high U.S. Treasury yields tested Wall Street's lofty valuations, keeping the U.S. dollar near multi-month highs. Market Performance : MSCI Asia-Pacific Index dipped 0.2% but remains 16% up for the year. Japan’s Nikkei slid 0.9%, still boasting a 20% annual gain. Chinese blue chips rose 0.3%, with most of their 16% yearly gain achieved after Beijing’s September stimulus promises. South Korea's index edged up 0.3% but is down 9% for the year, weighed by political uncertainties and events like Jeju Air’s recent plane crash. Global Futures : EUROSTOXX 50 futures gained 0.1%. U.S. futures saw slight declines, with S&P 500 and Nasdaq futures down 0.1%. Economic Drivers and Concerns U.S. Treasury Yields : Yields on 10-year Treasuries are near eight-month highs at 4.631%, up 75 basis points for the year. Rising yields reflect revised expectations of less restrictive monetary policy, raising concerns about potential impacts on corpo...
Barclays reported a robust 18% rise in third-quarter profit, beating forecasts as slower-than-expected interest rate cuts and a strong performance in its investment banking division prompted the bank to raise its income outlook for the year.
The British bank’s pretax profit for July-September hit £2.2 billion (US$2.85 billion or RM12.4 billion), surpassing both last year’s £1.9 billion and analysts' estimates of £2 billion. The strong performance led Barclays to upgrade its net interest income forecast for the year, expecting it to exceed £11 billion, rather than just meet that target.
Barclays' shares have surged 61% this year, nearing a nine-year high, and rose another 4% in early trading on Thursday. Analysts welcomed the results, with Richard Hunter, an analyst at Interactive Investor, stating that the positive market reaction was well-deserved.
The bank’s domestic lending business continued to perform well, supported by its £600 million acquisition of Tesco's banking arm earlier this year. Return on tangible equity for this unit rose to 23.4%, up from 21% a year ago.
In its investment banking division, third-quarter income rose 6% year-on-year, exceeding expectations due to increased corporate fundraising, dealmaking, and equities trading. Fixed income, currencies, and commodities revenue rose 3% to £1.18 billion, while advisory fee income surged 133% to £186 million.
Although Barclays' investment bank lagged behind some US and European rivals in overall performance, CFO Anna Cross noted that the bank fared well compared to US peers, particularly when factoring in the impact of reporting dollar revenues in pounds.
Barclays’ gains follow a major reorganization earlier this year aimed at improving investor confidence and further expanding its domestic lending business while optimizing its use of resources in the investment bank.
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