Europe's largest bank, HSBC, said on Tuesday that net profit in 2018 came below expectations following a challenging fourth quarter as markets globally experienced strong sales and reduced activity.
Global markets were hit by a sharp divestment of stocks and other asset classes in the fourth quarter of last year, leading to a loss of trading income in many. The banking group, HSBC will not be spared, said Kenny Wen, Hong Kong-based financial services chief financial officer Everbright Sun Hung Kai.
There were some issues that needed attention, Wen pointed out.
"First and foremost, from the revenue side. I'm a little worried about capital markets because, as we all know, last year's fourth quarter, mood and market conditions were not that good. So, capital markets or global markets as it is called in HSBC, revenue can be under pressure, Wen told CNBC's "Squawk Box" Tuesday before the earnings release.
The bank's lending operations can also be insufficient, especially in Hong Kong where the reference price has subsided and the growth in overall lending activities has slowed down, the strategist adds. Hong Kong is a key market for HSBC, which accounts for about one-third of total revenue in the first nine months of 2018.  In addition to the latest revenue, Wen said he would look for HSBC's Business View Guidance and Announcements on buybacks and dividends. He expects HSBC to announce a plan to buy back shares worth up to $ 1.5 billion.
"If the final figure is higher than this, say $ 2 billion or $ 2.5 billion, apparently it will be very positive for the stock price, Wen says.
Before the revenue release, HSBC's Hong Kong listed stocks were flat in early trading on Tuesday, shares have risen by 4.6 per cent so far this year.