BOV, MIA lose 2006 gains

Equities closed a dismal week on the Malta Stock Exchange with further declines during yesterday's session, as buyers took full advantage of the abundant amount of shares on sale to obtain the best entry position.

Sellers were most plentiful amongst banking sector equities where negative sentiment surrounding current valuations continued to push prices lower. Lombard Bank suffered the biggest decline, tumbling 35c4 or almost seven per cent as 12,372 shares were exchanged across eight transactions to close the session at Lm4.71c6.

Bank of Valletta completely erased this year's gains, which almost touched 40 per cent back in February, as 24,248 shares were sold across 28 transactions, squeezing the price down to Lm3.57, its lowest level since December 2005.

HSBC Bank Malta was the day's most actively traded equity with 48,365 shares, carrying a market consideration of Lm99,499, changing hands across 38 trades. The equity declined by a full percentage point to close at Lm2.05.

Elsewhere in the market, Malta International Airport dropped to its lowest level since August 2005. The day's trades consisted of 6,277 shares which were struck across eight deals at the Lm1.35 level, which represents a 2.9 per cent discount to its previous closing level.

Simonds Farsons Cisk dropped a penny on 3,146 shares which were offloaded down to 74 cents while International Hotel Investments maintained its previous closing price of €0.96.

Merger speculation lifts European banks

Yesterday, London stocks reversed early gains to trade flat in thin trade ahead the long weekend in the UK. However, the return of some well-rehearsed bid rumours did manage to inject some life into proceedings. The FTSE 100 was flat at 5,867.8, while the FTSE 250 ticked 0.2 per cent higher.

European equities were largely flat but merger speculation enlivened the banking sector.

By mid morning, the FTSE Eurofirst 300 was up 0.1 per cent, while Frankfurt's Xetra Dax was fractionally higher at 5,814.34. In Paris, the CAC 40 added 0.1 per cent. Italian banking mergers remained in the spotlight after Credit Agricole, the biggest shareholder in Italy's Banca Intesa, gave its approval to the possible merger between Intesa and Sanpaolo IMI.

Japanese stock indices were down moderately, hit by a steep slide of shares in Softbank.

The Topix was down 0.2 per cent. The Nikkei 225 ended 0.1 per cent lower. Both indices had initially risen in morning trading in response to much lower than expected inflation numbers.

Wall Street was set to open lower as crude oil prices rose and investors awaited a speech from Ben Bernanke, chairman of the Federal Reserve. An hour before the opening bell, S&P 500 futures were 0.82 points below fair value, and Nasdaq Composite futures were 0.38 points below fair value.

The financial news was compiled by Valletta Fund Management (tel. 8007 2344) and Bank of Valletta plc (Tel 2131 2020). BOV and VFM are licensed by the MFSA to conduct investment services business.