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HSBC share price outperforms as Morgan Stanley lifts forecasts

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Shares in HSBC Holdings (LON:HSBA) have advanced in London in today’s session following upbeat comments by Morgan Stanley. The news marks a boost for Europe’s biggest bank which recently updated investors on its first-quarter performance, posting a fall in profits.

As of 14:11 BST, HSBC’s share price had added 1.20 percent to 747.80p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.29 percent higher at 7,881.79 points. The group’s shares have added a little over 12 percent to their value over the past year, as compared with about a five-percent rise in the Footsie.

Morgan Stanley upbeat on HSBC

Morgan Stanley, which sees HSBC as a ‘conviction-buy,’ set a price target on the shares of 900p today. WebFG News quoted the analysts as saying that the London-listed lender’s ‘unique setup’ offered investors growth and yield and that there was ‘more to go’ from the shares. The broker further hiked its forecasts for the next couple of years, predicting that the FTSE 100 bank’s net interest income will ‘ratchet higher,’ with forward-driven advantage across key currency blocks at $2.6 billion to lift net interest income forecasts by a further two percent.

“Uniquely, we also see growth,” the analysts said, as quoted by the newswire, with new forecasts putting earnings seven percent above the consensus. HSBC’s CET 1 capital meanwhile is expected to reach 14.7 percent by 2020,  giving an excess of around $12 billion or 59 cents per share, marking about 5.1-percent yield.

Other analysts on Asia-focused bank

Goldman Sachs, which is ‘neutral’ on HSBC, set a price target of 790p on the shares earlier this month. According to MarketBeat, Europe’s biggest bank currently has a consensus ‘hold’ rating and an average price target of 759.18p.

As of 15:09 BST, Tuesday, 22 May, HSBC Holdings plc share price is 749.30p.

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