Wednesday, March 02, 2005

mixing days in Hong Kong

The worse-that-expected result of HSBC Holdings and its Hong Kong unit, Hang Seng Bank, contributed to the decline of the blue-chip index today, amid the uncertainty over whether the city's chief executive would resign early than expected.

Reuters reported that HSBC Holdings, which accounts for around one-third of the weighting of the Hang Seng Index, fell 1.53 percent to HK$128.50. It has shed 3.75 percent since announcing earnings late on Monday.

The Hongkong and Shanghai Banking Corp, the Asia Unit of HSBC Holdings, reported a 37 per cent rise in 2004 pertax profit to HK$17.61 billion, at the low end of the range of $17.20 billion to $18.92 billion in a Reuter Poll of 10 analysts.

Hang Seng bank, the second-largest listed bank in Hong Kong in terms of market capitalisation, reported a 14 percent rise in its second-half profit. while its operating profit operating income jumped 22 percent to HK$6.4 billion. The 2004 net income rose 20 per cent to $11.4 billion, compared with the expected $11.1 billion in a Reuters poll of 26 analysts.

The news of the resignation of the city's chief executive mixed the opinions in the market. Reuters said that some traders thought it would provide a short term lift to sentiment, while others said the rumors had already driven the market down.

"I know you all have a lot of questions in your heart, I will explain when it is appropriate". Our CE told reporters at a brief press conference in Beijing. But when?

1 comment:

Amy Gu said...

According to the latest report, analysts in group forecasted HSBC's revenue growth this year will be 8 per cent, cost growth 7 per cent, and pre-provision operating profit growth of 10 per cent. Also, JP Morgan has downgraded the 2005 and 2006 cash earnings per share forecasts by 12 per cent to 120 US cents and 125 US cents, respectively. Though the market seems worried about HSBC's future, the company are now busy at preparing for the change of the Chairman. Vincent Cheng Hoi-chuen, the first local soon-to-be chairman will replace David Eldon in the short term.