HSBC share price forecast ahead of quarterly earnings

The HSBC (LON: HSBC) share price will be in focus on Monday morning as the company publishes its quarterly results. The stock has risen in the past six straight days and is trading at the highest it has been since June this year. It has risen by more than 30% from its lowest level this month.

HSBC earnings

HSBC is the biggest European bank by assets. The company has more than $2.8 trillion in assets, making it bigger than its peers like Barclays and Lloyds Bank. 

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The HSBC share price has been in the spotlight in the past few years as investors have focused on several factors. For example, it has been caught at the crosshairs of Washington and Beijing. This is mostly because the company makes most of its money in places like Hong Kong. It is also expanding its wealth management services to mainland China. 

The company has also been in focus because of its exposure to China’s property market. The country’s property bubble seems to be bursting, with home prices falling. Evergrande, the second-biggest developer, has also moved closer to bankruptcy. It has more than $300 billion in liabilities. Other companies in the sector like Sinic and Fantasia Holdings have also struggled.

Therefore, the HSBC stock price will be watched closely on Monday when the company publishes its quarterly results. Despite the challenges, analysts expect that the bank will have strong results. For example, those at UBS expect that the company will report a $2.5 billion share buyback program as the management attempts to boost the share price. Its profit more than doubled in the second quarter.

The company’s stock will also react to the management’s comments about its exposure to the Chinese property sector. Recent results from its global peers like Goldman Sachs and Morgan Stanley have been relatively strong.

HSBC share price forecast

The daily chart shows that the HSBC share price has made a strong recovery in the past few weeks. Along the way, the stock has moved above the 78.6% Fibonacci retracement level. It has also risen above the 25-day and 50-day moving averages. Most importantly, it is approaching the important resistance level at 450p.

Therefore, the stock will likely rise after earnings since most of the bad news has already been priced in. However, a drop below the key support at 420p will mean that the stock will drop to below 400p soon.

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