The financial services sector is having one of its better days today. A number of banks, insurers and financial services companies have registered rising share prices, as investors take a more bullish stance ahead of the weekend.
Among the top risers in the large-cap sector is Barclays (LON:BARC) (LSE:BARC.L). Its shares are up 3% today at 228p. This is after rumours about the moving of its European headquarters to Dublin, which seemed to hurt investor sentiment earlier in the week. In my view, the bank has significant long term growth potential. I feel its strategy could deliver higher profitability and a better balance sheet.
Aviva plc (LON:AV) (LSE:AV.L) is another of today’s fastest climbers. It is up 2.1% at 490p. I think Aviva has potential as it integrates the Friends Life business into its own. I’m still a little cautious about the effect of Brexit on Aviva’s finances, but I think this is likely to have already been priced in. Therefore, I believe it is the top pick of the insurers at the moment.
Lloyds Banking Group PLC (LON:LLOY) (LSE:LLOY.L) and Prudential plc (LON:PRU) (LSE:PRU.L) have risen by 2.5% and 1.5% respectively today. I actually think the whole Brexit debate is not all that bad for Lloyds in the short run, as it takes some of the political attention away from the nationalisation of banking stocks. Prudential has experienced some difficulty under relatively new management, but I think the structure of the business is strong and I expect it to offer relatively sound returns over the long run.
Finally, Hargreaves Lansdown PLC (LON:HL) (LSE:HL.L) is 1.7% to the good today. I think there are better options within the asset management sector in terms of valuation, but I’m a big fan of the consistency Hargreaves Lansdown offers. Therefore, I think it has investment appeal, but it’s perhaps not right at the top of my buy list.