This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Technical Observations – For
Technical Observations – Against
Clear falling channel since beginning of year. Shares turned over at ceiling of falling channel. Equity markets are back fretting about global trade, uncertain about a US-China detente. A hard Brexit could hurt UK banks. A pause in US interest rate rises, and a delay before Bank of England hikes because of Brexit, may limit banks’ upside.
Risks to HSBC shares include a general market rally that favours risk asset such as Banks; a resolution of US China trade dispute, given the bank’s sensitivity to Asia; an increase in interest rates (UK or US) boosts the bank’s profitability (charge more to lend than pay on savings); a soft Brexit could see a sector relief rally.
Consensus may be Neutral/Bullish biased, but there are still 10% of brokers saying Sell. Clear downtrend offers a short term trading opportunity until shares deliver a meaningful breakout. Furthermore, 16% of broker targets suggest downside from current levels and 32% have a target no higher than our suggests stop-loss.
Next Event: Brexit deal vote, Tues 11th Dec; FY Results, 19 Feb
Latest Broker 12-Month Consensus: 37% Buy, 53% Hold, 10% Sell (full breakdown on request)
Source: DowJones Newswires, Reuters News, Bloomberg, Company Press releases, AlphaTerminal
This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.
Accendo Markets considers opinions and information contained within the research to be valid when published, and gives no warranty as to the investments referred to in this material. The income from the investments referred to may go down as well as up, and investors may realise losses on investments. The past performance of a particular investment is not necessarily a guide to its future performance.Prepared by Michael van Dulken, Head of Research