HSI Declines 90 Points as SINOTRUK Drops Over 5% Following Block Trade Report; Gold Mining Stocks Rise

The analyst rating for HSBC Holdings (00005.HK) is based on several favorable factors that are expected to significantly enhance its earnings performance. Barclays highlighted that HSBC is likely to exceed its guidance and market forecasts due to: 1. Positive conditions in the Hong Kong market. 2. The full integration of Hang Seng Bank. 3. Strategic initiatives that can mitigate the impact of fluctuations in US policies. Additionally, Barclays predicts that even with a potential decline in US interest rates, HSBC's net interest income (NII) for 2026 and 2027 will remain 4-5% above market consensus. This resilience in performance leads Barclays to reaffirm its Overweight rating on HSBC and raise the target price from GBP12.3 to GBP14.

The analyst rating from Citi Research for HSBC HOLDINGS is based on several key factors: 1. Lowered EPS Forecasts: Citi Research has slightly reduced its EPS forecasts for 2025-2027 by 0-1%, primarily due to the expectation of an additional Federal Reserve rate cut in 2026. 2. Higher Revenue Assumptions: Despite the slight decline in EPS forecasts, Citi's projections remain 2-9% higher than the latest market consensus for the company's profit before tax. This is attributed to expectations of strong revenue growth, particularly in non-interest income from the Asian wealth business. 3. Positive Return on Tangible Equity (RoTE): Citi believes that HSBC can achieve a RoTE of approximately 19-20% in 2027-2028, indicating strong profitability potential. 4. Increased Target Price: With the introduction of a 2028 forecast and an extended terminal year in its valuation model, Citi raised its target price for HSBC from $127.8 to $138.3. 5. Reiterated Buy Rating: Given these factors, Citi Research has maintained a "Buy" rating on HSBC HOLDINGS, reflecting confidence in the company's future performance despite the minor adjustments to EPS forecasts.