HSBC raises target price to HK$118 for Hang Seng Index (00005), expects second quarter net interest income to drop 1%.

According to the Wisdom Financial APP, JPMorgan Chase released a research report stating that it is estimated that HSBC Holdings (00005) will see a slight decrease of 1% in second quarter net interest income from banking business to 10.5 billion US dollars, with a slight decrease in net interest margin and loan size remaining stable. The bank believes that the management's guidance of 42 billion yuan in net interest income for the full year carries potential downside risks; even with the weakening of the US dollar, the bank also takes into account the HIBOR decrease in the second quarter. In terms of valuation, the bank has lowered its risk-free interest rate assumption from 4% to 3%, raised its target price from 108 Hong Kong dollars to 118 Hong Kong dollars by 9.3% until December next year, and maintains a "hold" rating.