HSBC has surprised on the upside in a trading update with a 14% profit beat and a fresh $3bn buyback.
Q3 net interest income $10.6bn ($10.7bn expected) while Q3 non-interest income was $6.4bn ($5.3bn expected) and Q3 adjusted profit before tax gained 10% to $8.7bn ($7.7bn expected)
The $3bn buyback was announced as expected.
Matt Britzman, senior equity analyst, Hargreaves Lansdown said HSBC shares were up 3% in Hong Kong earlier today "after a big beat on the profit line over the third quarter".
He added: "Chinese stimulus increased client activity for the wealth division, and strong trading activity in the foreign exchange, equity and debt markets helped propel investment banking fees higher – akin to what we saw with the major US banks.
"The new buyback, while expected, will still be taken as a positive and speaks to the work HSBC has done in recent times to optimise the capital structure and strip out some non-core assets. Looking ahead, net interest income will come under more scrutiny as rates in the US no longer act as a tailwind, and loan growth looks to be a challenge.”
