The big banks have been displaying their financial muscle this week. They are making profits and, more to the point in these febrile days, are “beating analysts’ expectations” for the key numbers. On Tuesday HSBC led the way, posting pre-tax three-monthly profits of £5.8 billion against analysts’ guesses of £5.3 billion, and up from £4.8 billion this time last year.
Nevertheless, the shares took a dive. The immediate cause was the worsening prospects in China, now that all pretence of a market-driven economy has gone, following Xi Jinping’s elevation to absolute power for as long as he likes. This was sheer bad luck for the bank’s spinners, but in truth, getting a grip on what’s inside the bank is as hard as trying to analyse the six-man Politburo Standing Committee under Xi.
