x Abu Dhabi, UAEWednesday 26 July 2017

HSBC shares recover

Banking giant HSBC shares in Hong Kong jumped 12 per cent in early trading but fell back to close with a 2.3 per cent gain.

Hong Kong-listed shares in HSBC rose 2.3 per cent today, and finished the day well from earlier highs after China issued gloomy new economic data. The banking giant was up nearly 12 per cent in early trade, following a similar rebound yesterday after shares lost more than 24 per cent on Monday in a single transaction, which is now being investigated by Hong Kong's securities watchdog. But it fell back to just a 2.3 per cent gain, closing at HK$38.45 (Dh18.21). A rights issue that's due tomorrow will raise almost US$18 billion (Dh66.11m) in capital for the bank.

Analysts told Dow Jones Newswires the market was concerned about HSBC's operating outlook. The bank insisted yesterday that it was still in solid shape despite the sharp drop on Monday and that the rights issue was fully underwritten. Last week, the bank announced a worse-than-expected 70 per cent drop in annual net profit and said the rights issue was needed for future investments, and not to shore up its balance sheet. *AFP