HSBC Share Price Forecast Ahead of Q3 Earnings

The HSBC share price has staged a strong comeback ahead of the upcoming corporate earnings. It rose to a high of 480p, which was the highest level since October 5. The stock has risen by more than 8% from the lowest level this year. Other UK banks like Lloyds, NatWest, and Barclays have also made a strong recovery recently.

HSBC earnings preview

HSBC Bank will publish its third-quarter results on Tuesday. The company’s results are expected to be mixed as the impact of high-interest rates continues. Rates have risen in key countries where the bank operates like in the United States, the UK, and Hong Kong. 

As a result, analysts expect that the company’s net interest earnings will rose in the third quarter. This is in line with how American banking giants performed. For example, JP Morgan’s net interest income rose by 51% while Citigroup’s net interest margin rose by 73%. Bank of America’s net interest income rose to $13.8 billion.

High interest rates have mixed impacts on a bank like HSBC. On the one hand, they increase its net interest income due to higher margins. At the same time, defaults tend to jump as recession risks rise.

In its most recent quarter, the company said that it expects its full-year revenue to soar to $31 billion followed by $37 billion in the following year. The company’s RoTEis expected to rise to at least 10% in FY23 and above 12% the following year. On dividends, the company will reinstate its quarterly dividends from 2023.

HSBC share price forecast

The four-hour chart shows that the HSBA stock price has made a strong recovery recently. It managed to move above the 23.6% Fibonacci Retracement level. The stock also moved above the 25-day moving average while the Relative Strength Index (RSI) moved above the neutral point. It has also formed a small inverted head and shoulders pattern.

Therefore, the stock will likely continue rising as bulls target the key resistance point at 500p. A move below the support level at 470p will invalidate the bullish view.

HSBC share price