Home Money MARKET REPORT: China’s Ping An insists it will not bail out HSBC

MARKET REPORT: China’s Ping An insists it will not bail out HSBC

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Boost: HSBC is up 12 per cent this year, valuing the bank at £130bn

HSBC’s biggest investor has insisted the bank is a “long-term investment” amid suggestions it is looking to reduce its stake.

Chinese insurance group Ping An is said to be looking to reduce its 8 per cent stake – valued at £10bn – after failing to convince the London-listed lender to spin off its Asia business.

But yesterday he responded to suggestions that he was bailing out, saying: ‘HSBC is our long-term financial investment.

‘The bank has maintained a unique competitive advantage in Asia. We trust in its long-term development.”

HSBC shares rose 0.1 per cent, or 0.5 pence, to 697 pence. The shares are up 12 per cent this year, valuing the bank at £130bn.

Boost: HSBC is up 12 per cent this year, valuing the bank at £130bn

Ping An has long insisted that the bank would be better off spinning off its business in Asia, where it generates most of its profits. HSBC has resisted, however, and Chairman Mark Tucker told the bank’s shareholders in Hong Kong last month that a spin-off of its Asian business will not happen. But the bank has intensified its focus on Asia and scaled back its empire that once spanned the globe.

The FTSE 100 was down 0.2 per cent or 18.39 points to 8,420.26, but is still up almost 9 per cent this year, having hit a series of record highs in recent weeks.

The FTSE 250 fell 0.4 per cent, or 72.94 points, to 20,749.9.

The subdued session came after the Dow Jones Industrial Average surpassed 40,000 points in New York for the first time on Thursday before giving up its gains. The Dow Jones rose 0.08 percent yesterday.

Investors are grappling with the outlook for interest rates on both sides of the Atlantic.

1716008901 116 MARKET REPORT Chinas Ping An insists it will not bail

While it looks like the Bank of England will cut rates this summer (in June or August), the Federal Reserve could wait until later in the year.

Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, said: ‘Although market enthusiasm has plateaued slightly, the Footsie remains in generally good spirits.

“This comes after the Dow Jones hit an all-time high, as positive expectations about the Federal Reserve’s interest rate plans continue to boost sentiment.”

GSK raised £1.25bn by selling its last remaining stake in Sensodyne and Advil firm Haleon, almost two years after spinning off the consumer healthcare group. GSK dumped Haleon shares at 324 pence each, ending a gradual sale of its stake in the company.

It has raised around £3.9bn in total from share sales, which began in May last year.

Haleon was formed in 2019 by merging the consumer healthcare businesses of British pharmaceutical group GSK and US rival Pfizer, as a joint venture within GSK. It was separated from GSK as an independent company listed on the London Stock Exchange in July 2022.

GSK initially retained a 12.9 percent stake in Haleon, but both GSK and Pfizer have been selling their stakes in the company.

GSK shares fell 0.5 per cent, or 8.5 pence, to 1,775 pence and Haleon lost 1 per cent, or 3.4 pence, to 329 pence.

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