HSBC (HSBA)

HSBC is the most globally exposed UK Bank, with a focus on its home territory of Asia. The bank has a range of operations, including retail and investment banking divisions as well as a major foreign exchange department. Although the bank is headquartered in London, it has locations on every continent, which means it can be influenced by events across the world, including trade tariff spats (US China) and geopolitical scuffles. New CEO (internal) taken the helm.

HSBC shares hit a 9-year high in January, having rallied on hawkish central bank rhetoric, US tax reform and hopes of increased global growth. They then retreated by 18.5%, but have since rebounded by 5.6%. Like RBS they are toying with a key resistance level, a break above which could open the door for a 16% recovery. Will Q1 results be the architect of said breakout. Or perhaps peer results will be the engineer?

Will HSBC better 2018 highs of 798p (+16%) or retreat to 2018 lows of 650p (-5%)?

• Shares fallen sharply from Jan highs; support and bounce from May 2017 lows
• Some bullish technical signals (Momentum, RSI, etc)
• Brokers positively skewed, with over 90% of broker targets suggesting upside from here
• 8% average results day trading range since 2012 (3.8% for Q1 updates too).
• In the 10-day run-up to FY results in Feb and Q1 results last April, HSBC shares rallied 3-4%

Broker Consensus: 34% Buy, 56% Hold, 9% Sell

Bullish: Jefferies, Buy, Target 950p, +38% (11 Mar 18)

Average Target: 765p, 11% (13 Apr 18)

Bearish: AlphaValue, Sell, Target 589p, -14% (5 Apr 18)

Pricing data sourced from Bloomberg on 13 April 2018. Please contact us for a full, up to date rundown.