The HSBC share price will be in the spotlight in London as investors reflect on the company’s decision to exit its American retail banking business. The stock rose by 0.30% in Hong Kong. It ended the day at 446p in London yesterday.
HSBC news: HSBC confirmed earlier rumours that it will exit its American retail operations as it shifts its focus to the Asian region. The bank said that it will sell 90 of its 148 branches in the United States. It will also close about 40 more branches. Its west and east cost businesses will be sold to Citizens Bank and Cathay General Bank. Most importantly, the bank will convert some of its remaining locations to international wealth cenrers.
In total, its total customer count will decline from 1.4 million to more than 300k. It will also change its customer focus, meaning that it will only serve those with more than $75,000 balances. In a statement, the company said:
“This next chapter of HSBC’s presence in the U.S. will see the team focus on our competitive strengths, connecting our global wholesale and wealth-management clients to other markets around the world.”
The news will likely be welcomed by investors because HSBC has historically struggled in the United States, a country that is dominated by banks like JP Morgan and Citi. Also, it will be a good thing since it will allow the company to focus on wealth management in Asia, the fastest-growing region in the world. It is also considering to sell its France operations.
HSBC share price analysis
The daily chart shows that the HSBC share price has been in a tight range recently. It has formed a rectangle pattern whose support and resistance are at 412p and 456p. The stock is slightly above the 38.2% Fibonacci retracement level and is at the same level as the 25-day and 50-day weighted moving averages.
Therefore, while the stock will likely remain in the current range, there is a possibility that it will bounce back higher as bulls target the 50% retracement level at 483p, which is about 7.8% above the current level.