Jump to content

HSBC shares drop after third quarter profit release


MongiIG

Recommended Posts

Despite improved earnings from interest-bearing business, the London-listed stock opened down around 5%. A worsening credit environment dragged on the stock, taking it down close to an area of key support.

 

 Jeremy Naylor | Writer, London | Publication date: Tuesday 25 October 2022

HSBC earnings

The first of London's big banks has reported this morning, and it's been a bit of a disappointment to the markets because the numbers fell year-on-year (YoY). In fact, the third quarter (Q3) was better than had been expected.

Let's take a look at the figures as they came through today. This is HSBC on its third quarter numbers: pretax profit of $3.15 billion, down 42% from $5.4 billion this last year, but well above the $2.5 bn analyst estimates compiled by the bank.

Now, the drop is because of the rising credit loss provision and other impairments, but its net interest income surged as banks benefit from rising interest rates. Now, the result included an impairment of $2.4 billion following the reclassification of the bank's retail operations in France to be held for sale.

Stock heavily down

So the net effect of that was we saw the stock down heavily on the session today. And in fact, it's the biggest decline we've seen in this stock since the 26th of April this year and we are very close to closing in on this line of support down here at four 42.4 - 451 is where we are at the moment.

It certainly seems like much of the downside has now been seen by the bank. It was down three and a half percent in the Hong Kong markets, is currently down 4.8% here in London. That line of support at 442 marks a point at which it would then dip down into levels not seen since December last year.

So the markets looking very weak for HSBC despite the fact it's made a lot of income coming through from this rise in interest rates. Clearly the rising credit loss provisions are a concern and this is something that's going to be underscoring banks' performance in the next quarter as well as consumers finding it harder and harder to keep above the waterline in terms of household expenditure.

So HSBC on the way down today, marking the first of the big British banks to report earnings this week.

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
      23,043
    • Total Posts
      95,436
    • Total Members
      43,657
    • Most Online
      7,522
      10/06/21 10:53

    Newest Member
    qusaiz
    Joined 30/09/23 18:13
  • Posts

    • Sorry, I didn't get it... What's Dual investment? 
    • The crypto market appears to be showing signs of recovery, with significant improvements in the Sharpe Ratios of Bitcoin, BGB, and Ethereum, according to an article published on Friday.  The Sharpe Ratio, a measure used to understand the return of an investment compared to its risk, has seen a notable increase for both cryptocurrencies. Bitcoin's Sharpe Ratio has risen from -2.4 to 0.68, while Ethereum and BGB have also experienced a similar uptrend. This change signifies higher returns at lower risk, which is expected to attract more investors to the crypto market. In addition to the improved Sharpe Ratios, increased network activity and trading volume as shown on CEXs like Bitget, Binance, and a few DEXs are suggesting a healthier market state. The current trading prices of Bitcoin, reflect this overall positive market sentiment. As of Friday, Bitcoin was trading at $27,069.73, BGB at $0.454 and Ethereum at $1,677.89. These developments are significant as they indicate reduced risk in the crypto market. The increase in the Sharpe Ratios for Bitcoin, BGB, and Ethereum suggests that these cryptocurrencies are becoming less risky investments, which could potentially lead to an influx of new investors into the market.  Could this rise in Sharpe Ratios coupled with increased network activity and trading volume point towards a recovering and less risky crypto market?
    • Hi, That's great, thank you very much. Very helpful! Many thanks.
×
×
  • Create New...
us