HSBC Holdings (LON:HSBA) has agreed to pay $1.6 million over a ‘spoofing’ probe in the US. Reuters reported yesterday that the Justice Department and the country’s derivatives regulator had filed charges against Europe’s biggest lender and peers UBS and Deutsche Bank.
HSBC’s share price has fallen into the red in today’s session, having given up 0.58 percent to 766.00p as of 09:41 GMT, marginally underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.36 percent lower at 7,643.58 points. The group’s shares have added more than 12 percent to their value over the past year, as compared with a near seven-percent rise in the Footsie.
Reuters reported yesterday HSBC, UBS and Deutsche Bank, as well as former traders at the banks and individuals at other firms, were charged following a large-scale multi-agency probe including the Commodity Futures Trading Commission into ‘spoofing’ in metals and equities futures.
Spoofing involves placing bids to buy or offers to sell futures contracts with the intent to cancel them before execution. By creating an illusion of demand, spoofers can influence prices to benefit their market positions.
HSBC will pay $1.6 million to settle the charges in the case. A spokesman for the Asia-focused bank told the newswire that the group was pleased to have resolved the matter.
The news comes after HSBC recently agreed to pay $101.5 million to settle a foreign exchange investigation in the US.
Analysts on HSBC
Goldman Sachs, which has a ‘neutral’ rating on the FTSE 100 group, recently set a price target of 820p on the shares. According to MarketBeat, HSBC currently has a consensus ‘hold’ rating and an average price target of 750.36p. The company is scheduled to update investors on its annual performance on February 20.