Bank share prices 'to remain choppy'

24 December 2012

UK bank share prices are likely to remain choppy in 2013, it has been predicted.

Michael Hewson, senior market analyst at CMC Markets UK, explained next year will see continued uncertainty in the euro area, with the economies of Spain and Italy posing real threats, the Scotsman reports.

Despite this, Mr Hewson noted the past few months have been fairly positive for the banking sector, which has been driven by the new bond-buying programme of the European Central Bank, in addition to moves toward a new European banking union and the Spanish banking bailout.

As a result of these developments, the short-term risks of the collapse of the financial system in Europe and the disintegration of the euro appear to have been removed.

Mr Hewson stated: "One thing seems certain - given the tight funding problems set to face sovereigns as well as banks - financials will continue to remain volatile."

Standard and Chartered and HSBC in particular are likely to be helped by a recovery in Asia, the expert added.

By Gary Cooper

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