Shares in HSBC Holdings (LON:HSBA) have climbed higher in London in today’s session, ahead of the blue-chip lender’s first-quarter results tomorrow. Europe’s biggest bank will conclude the FTSE 100 banking reporting season following results at peers Barclays (LON:BARC), RBS (LON:RBS), StanChart (LON:STAN) and Lloyds (LON:LLOY).
As of 14:01 BST, HSBC’s share price had added 0.42 percent to 667.70p, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.22 percent lower at 7,368.71 points. The group’s shares have lost more than eight percent of their value over the past year, as compared with about a 2.4-percent fall in the Footsie.
HSBC results preview
HSBC is scheduled to update investors on its first-quarter performance tomorrow and Proactive Investors reports that UBS expects the FTSE 100 lender to report a pre-tax profit of $5.7 billion for the quarter, compared to $6 billion a year ago, on a 233-percent surge in impairments to $566 million.
The broker further forecasts total income of $13.7 billion, marking a one-percent dip on the prior year, with net interest income up three percent to $7.7 billion and non-interest income down five percent to $6 billion.
Bloomberg meanwhile quoted Joseph Dickerson, a bank analyst at Jefferies, as commenting that key for investors would be “the pacing of spending, as that has a direct knock-on for costs versus revenues”.
“I think they may be able to show positive jaws, as they are going to be able to pace investment. If they miss, it will be on revenues,” he added.
Analyst ratings update
Goldman Sachs, which is ‘neutral’ on the Asia-focused lender, set a target of 775p on the HSBC share price last week, while Credit Suisse, which also rates the company as ‘neutral,’ boosted its valuation from 655p to 670p. According to MarketBeat, the London-listed lender currently has a consensus ‘hold’ rating and an average price target of 665.50p.