U.S. stocks fell, pausing the post-Christmas rally of 18 percent, as investors awaited fresh clues on the outlook for global trade and monetary policy. Treasuries and the dollar edged higher. The S&P 500 fell for just the second time in seven sessions as the next round of trade talks between America and China restart in Washington this week.
The Asia-focused bank missed consensus forecasts for full-year underlying pretax profits by 24%. HSBC, though, is meant to have a simple story, driven by Asian loan growth. For sure, HSBC wasn’t alone in having its investment bank suffer during the late-year market turmoil, which hurt bond and currency trading in particular.
Trading updates in recent weeks from Nationwide Building Society, Royal Bank of Scotland Group Plc and Metro Bank Plc said competition to lend to British home buyers was intensifying, even with Brexit looming. HSBC has been wooing first-time home buyers in London with loans up to 95 percent of the value of the property, leading other banks to follow suit. This “ring-fencing”, which seeks to protect retail deposits from risky investment banking, has sealed away capital in units where mortgages are one of the few avenues for growth.
The retailer earned an adjusted $1.41 per share for the fourth quarter, beating estimates by 8 cents a share. Revenue also beat Wall Street forecasts. U.S. comparable-store sales rose 4.2 percent, topping the Refinitiv consensus of a 3.2 percent increase.
The pledge – laid out Tuesday by Chief Executive Officer John Flint – may seem like wishful thinking, given the lengthening list of challenges to the bank’s revenue growth. For investors, it means HSBC will have to gin up growth faster than last year’s 5 percent gain, slow investing or cut costs. On Tuesday, HSBC posted a 1 percent drop in adjusted pretax profit of $3.39 billion for the three months ended Dec. 31, missing the $4.4 billion consensus.
PLC reported lower-than-expected fourth-quarter profit Tuesday as choppy financial markets, U.S.-China trade tensions and Brexit uncertainty weighed on the global bank. HSBC shares fell 4% in Hong Kong after it said cost growth outstripped revenue at the end of 2018. in an interview said the bank had been on track to meet fourth-quarter cost control targets until revenue collapsed in parts of the bank in November.
The FTSE 100 was down 0.5 percent and the FTSE 250 was down 0.3 percent by 0936 GMT. HSBC was by far the biggest drag on the main bourse and on track for its worst day in almost two years, as recent uncertainty around the Sino-U.S. trade situation was reflected in the Asia-focused bank's disappointing profit growth. Its shares slipped 4.2 percent and the bank warned that weaker economic outlooks for China and Britain would pose more challenges this year, prompting Markets.com analyst Neil Wilson to note that HSBC's focus on China and Asia was a "double-edged sword".
HONG KONG/LONDON (Reuters) - HSBC warned it may have to delay some investments this year as Europe's biggest bank missed 2018 profit forecasts due to slowing growth in its two home markets of China and Britain. Its shares fell 3 percent and analysts cut their forecasts as HSBC reported a drop in fourth-quarter revenue amid tumbling stock markets that sapped customer's confidence in investing. At the end of his first year in charge, Chief Executive John Flint said HSBC may have to delay investment plans in order to avoid missing a key target known as 'positive jaws' - which tracks whether ...
European shares slipped from four-month highs on Tuesday as anxiety over potential tariffs on European car imports to the U.S. dampened the optimistic mood over U.S.-China trade talks. At 0940 GMT, the STOXX 600 was down 0.4 percent while Germany's DAX held flat. A new round of talks between the United States and China to resolve their trade war will take place in Washington on Tuesday.
Chief Executive Officer John Flint has vowed to keep a keener eye on costs while avoiding additional payouts to shareholders, after a disappointing quarter capped his first year in charge of Europe’s largest bank. Like its rivals, HSBC, which gets most of its business in Asia, was hit by the meltdown in financial markets, which pushed investment bank revenues lower. Pressure is also growing on HSBC’s management to improve returns by repurchasing stock, and the bank said it’s committed to its previous policy of returning capital to shareholders.
“If the euro-area economy were to slow more sharply, we could adapt our forward guidance on interest rates and this could be complemented by other measures,” Peter Praet said in an interview with German newspaper Boersen-Zeitung published late Monday. Praet, who proposes policy to the ECB’s Governing Council, is the second official in as many days to flag a potential shift in language that currently pledges unchanged borrowing costs at least through the summer.
Feb 19 (Reuters) - Britain's FTSE 100 index is seen opening 8 points higher at 7,228 on Tuesday, according to financial bookmakers. * RECKITT BENCKISER: British consumer goods group Reckitt Benckiser reported ...
Europe's biggest bank has reported its net profit jumped 30 percent in 2018 from the previous year to $12.6 billion. London-based HSBC, whose profit is mainly from Asia, said its revenue rose 5 percent from a year earlier to $53.8 billion. Pre-tax profit rose 16 percent to $19.9 billion, but lagged analysts' estimates.
Feb 19 (Reuters) - HSBC Holdings PLC: * POSSIBLE THAT ADDITIONAL ACTIONS WILL BE INITIATED AGAINST HSBC IN RELATION TO ITS HISTORICAL FOREIGN EXCHANGE ACTIVITIES * IN OCT'18, HSBC HOLDINGS AND HSBC BANK ...
Feb 19 (Reuters) - HSBC Holdings Plc: * COMMON EQUITY TIER 1 RATIO AS AT DEC 31, 2018 14.0% VERSUS 14.3 % AS AT SEPT 30, 2018 * DECLARES ANNUAL DIVIDEND OF $0.51 PER SHARE * FY ADJUSTED REVENUE $ 53,940 ...