CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

HSBC share price: where next as profits slump after weak performance in Europe and US

In its Q3 results, the bank said its weak performance in its European and US divisions is ‘not acceptable’, prompting the lender to accelerate its restructuring plans for both units.

HSBC unveiled a disappointing set of third quarter results on Monday, with underlying revenues down 2% to $13.3 billion and a 12% decline in pre-tax profits to $5.3 billion – below analysts’ expectations.

The bank blamed its weaker-than-expected performance on lower client activity in global markets, particularly in Europe and the US.

The news drove HSBC’s shares 3% lower on Monday, closing at 598p.

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HSBC plans to overhaul European and US divisions

In the wake of its Q3 results, HSBC said that it plans to restructure its business and said its performance in parts of Europe and the US was ‘not acceptable’.

HSBC’s interim CEO Noel Quinn said that the bank plans to overhaul both divisions which were ‘no longer sufficient’, with the lender looking at ‘accelerating plans to remodel them’.

Restructuring plans could lead to further job losses

Earlier this month, it was reported that HSBC planned to cut up to 10,000 jobs in a bid to reduce operating costs amid challenging market conditions that have squeezed margins and hurt the bank’s bottom line.

Following the bank’s results on Monday, Quinn told Reuters that ‘there is scope throughout the bank to clarify and simplify roles, and to reduce duplication’.

You can go long or short HSBC with IG using derivatives like CFDs.

Growth in Asia unable to offset poor performance globally

HSBC has relied on strong growth in Asia to offset its weaker performance in other regions. However, the world’s local bank continues has seen profits in Asia hampered ongoing US-China trade war and civil unrest in Hong Kong.

‘Parts of our business, especially Asia, held up well in a challenging environment in the third quarter,’ Quinn said. ‘However, in some parts, performance was not acceptable, principally business activities within continental Europe, the non-ring-fenced bank in the UK, and the US.’

In its third quarter, HSBC saw its pre-tax profit in Asia increase by 4% to $4.7 billion.

This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

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