HSBC Bank Malta dictated terms once again of the Malta Stock Exchange as the Index heavyweight set off gains in less capitalised equities like Lombard and GlobalCapital.

HSBC shares dropped eight- tenths of a cent, after opening the session at the Lm1.90 level, and eventually closing at the Lm1.89,2, which was also the day's low. Activity in the equity was spread across eight deals carrying 7,900 shares.

GlobalCapital marched on Monday's positive performance as the equity climbed a further 5c or 2.5 per cent on the exchange of 8,700 shares to close the session at Lm2.05. Lombard Bank mirrored Monday's upbeat session with an advance of a further 3c. Gains were however realised on a single trade of 1,000 shares which may not give much support to the current price.

Maltacom was the most heavily traded equity on the day, as 29,950 shares were exchanged across 11 deals. The relatively substantial volumes in the equity trimmed two- tenths of a cent from the equity's previous closing price to settle again at the Lm1.40 level.

Solo trades in Simonds Farsons Cisk and Grand Harbour Marina forced both equities lower, with the latest addition on the local equity market shedding 2c9 to close at 75c9 and this year's top performer, Farsons, dropping 1c to 99c.

Meanwhile, in the regular market, three other equities were traded, mainly Bank of Valletta, Malta International Airport and Middlesea Insurance. All of the aforementioned companies registered single trades with meagre volumes without impinging either way on the equities' previous closing prices. Volumes on the fixed income sector were also very light, with trades being executed on two corporate stocks and three government issues.

European Banks push equity markets lower

European equity markets yesterday fell sharply, with financial stocks heading the losses, as concerns over the state of the US subprime mortgage market hit banking stocks. In early trade, the FTSE Eurofirst 300 was down 0.9 per cent to 1,583.97, while Frankfurt's Xetra Dax fell 1.3 per cent to 7,829.12, the CAC 40 in Paris lost one per cent to 5,941.75 and London's FTSE 100 shed 0.7 per cent to 6,544.3.

Fears that some European banks could be exposed to subprime risks have hit the sector in recent sessions, following news of the near collapse of two funds associated with Bear Stearns. Deutsche Bank, which lent money to the funds, fell 1.5 per cent to €107.36. Meanwhile, UBS, the Swiss bank which last month shut down operations at its Dillon Read hedge fund over subprime losses, was down 1.1 per cent to SFr73.95.

In Asia, falls in the shares of some heavy exporters were counterbalanced by a rise in several domestic sectors, leaving Japan's large-cap stock indices virtually unchanged yesterday, the slowest trading day in a month. The more export-sensitive Nikkei 225 slipped 0.1 per cent to 18,066.11 while the slightly more domestically weighted Topix gained 0.1 per cent to 1,765.87. Exporters lost ground as the yen advanced slightly against the dollar. By late afternoon, the yen was trading at Y123.2 against the greenback.

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.

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