Financial News

The local equity market reacted negatively to news relating to Maltacom's privatisation bid and as a result in excess of Lm81.5 million worth of market capitalisation was wiped off.

Ironically there was no trading in Maltacom shares which therefore closed the session unchanged at Lm2.15c. No one seemed willing to purchase shares at current prices given the company's announcement informing that Tecom Investments LZ-LLC has made an offer of €214,000,000 for the government's 60 per cent shareholding, which offer translates to a price of Lm1.51c per share. At the end of the session a grand total of 404,050 shares were outstanding on the offer side at the Lm2.02,5.

Bank of Valletta, another company where the government intends to sell its stake, was worst hit by the negative sentiment. As a result, the price plummeted by 6.8 per cent to close at the Lm4.55,5 level.

Selling activity even spread over to HSBC Bank Malta where 31,830 shares were sold across 133 shares. The price tumbled by 54c or 4.7 per cent to close the day at the Lm11 level.

The decline in Lombard Bank was relatively controlled as 819 shares were exchanged across five transactions, squeezing the price 2.5 per cent lower to Lm11.40.

Elsewhere in the market, low volume sell orders brought a 5.6 per cent drop in Middlesea Insurance share price which plunged down to the Lm5 level.

Malta International Airport and International Hotel Investments were spared from the blood bath as investors exchanged holdings without affecting the previous closing prices of Lm1.54c and €0.85 respectively.

Europe lower as Arcelor defence announced

European equities were lower yesterday, after the previous session's strong gains and lacklustre trade on Wall Street overnight prompted profit taking. The FTSE Eurofirst 300 was down 0.3 per cent to 1,376.86, while Frankfurt's Xetra Dax fell 0.2 per cent to 6,010.98. In Paris, the CAC 40 shed 0.5 per cent to 5,229.14 and London's FTSE 100 slipped 0.3 per cent to 6003.9.

In Europe details of a counter offensive were announced by Arcelor, the steelmaker, in its bid to fend off the unsolicited advances of rival Mittal Steel. The world's second-biggest steelmaker said it would raise its 2005 dividend to €1.85 per share, from the €1.20 previously announced, and distribute an additional €5 billion to shareholders, either through a share buyback or an extraordinary dividend. Shares in Arcelor were down 0.7 per cent to €32.57, while ThyssenKrupp fell 0.5 per cent to €23.76.

Japanese stocks lost earlier gains to close lower yesterday, responding to widespread profit-taking. The Nikkei 225 closed 0.2 per cent lower at 17,292.91. The Topix fell 0.3 per cent to 1,749.65. Banking led the decline, falling 0.9 per cent after recent strong rises. Mitsubishi UFJ, the world's biggest bank by assets, declined 1.6 per cent to 1.81 million yen.

Export-focused stocks also suffered from profit-taking, despite continued yen weakness. In the electrical machinery sector, Sharp, the consumer electronics and liquid crystal display maker, dropped 1.4 per cent to Y2,080. Elpida Memory declined 1.1 per cent to Y4,390. Honda, the carmaker, fell 0.5 per cent.