HSBC Holdings Plc (HSBC) shares closed the shortened trading week in London at 1,393.60 pence, up 0.91%, hovering near the highs reached in late May. The stock ended the four-session week 1.4% higher, recovering from an early-May selloff. The London Stock Exchange was closed Monday for the Spring Bank Holiday.
In Hong Kong, HSBC shares slipped to HK$145.10, down HK$0.20, while New York ADRs gained $0.79 to close at $93.74, according to the bank's investor page.
The gains came despite a 0.2% decline in the FTSE 100 on Friday. UK indexes still posted a second consecutive monthly gain, supported by optimism over a potential U.S.-Iran ceasefire extension and reduced expectations for further Bank of England rate hikes, as reported by Reuters.
HSBC was not alone in its positive performance. Standard Chartered climbed 1.55% on Friday, NatWest rose 1.56%, and Barclays added 1.22%, all outpacing the broader FTSE 100. The overall strength in UK bank shares signaled firm sentiment heading into the weekend.
On Friday, HSBC filed two routine regulatory notices. One disclosed total voting rights of 17,183,563,842 ordinary shares. The other reported the issuance of 3,312 ordinary shares for employee share plans.
Investors remain focused on a key question: can higher income from rates and wealth management truly offset rising credit concerns? HSBC's first-quarter results, released in early May, showed profit before tax, excluding notable items, of $10.1 billion, on revenue of $19.1 billion. The bank also reported an annualized return on average tangible equity of 18.7% excluding notable items.
CEO Georges Elhedery reiterated the bank's strategy of building "a simple, more agile, growing HSBC" and expressed confidence in the targets set in February. The bank raised its 2026 banking net interest income forecast to approximately $46 billion. Net interest income measures the difference between what banks earn on loans and securities and what they pay for deposits and other funding.
HSBC's shares have been buoyed by this strategy since earlier this year. In February, Russ Mould, investment director at AJ Bell, noted that HSBC had "slimmed down to focus on fewer regions" and was targeting wealthier customers, a plan that appeared to be working after solid wealth figures, as reported by Reuters.
The May 5 earnings release drew attention after Reuters reported a surprise $400 million loss tied to the collapse of UK mortgage lender Market Financial Solutions (MFS). This raised questions about private credit risks. CFO Pam Kaur told reporters the bank had reviewed its riskiest exposures and found nothing else "comparable" to the loss, according to Reuters.
Citi analysts highlighted HSBC's 18% wealth revenue gain in the quarter, trailing Standard Chartered's 32% growth. In the same peer group, Barclays took a 228 million pound hit related to the MFS collapse. HSBC's valuation remains tied not only to interest rates but also to Asian wealth performance and credit management.
Looking ahead, CEO Elhedery is scheduled for a fireside chat at the Goldman Sachs European Financials Conference on June 3. HSBC's next major reporting event is set for August 4, when it will release interim results for 2026.
Risk factors remain. HSBC increased its expected credit losses to about 45 basis points of average gross loans for 2026, above its medium-term target of 30 to 40 basis points. A basis point equals one-hundredth of a percentage point. If private credit troubles worsen, or if Middle East tensions push inflation and rates higher, the shares could appear stretched rather than holding near their highs.
