Financial news
BOV, Maltacom attract buyers
Gains by Bank of Valletta and Maltacom shares offset declines elsewhere in the market during the mid-week session at the Malta Stock Exchange, with the Index closing the day marginally higher at 4,896 points.
Sustained buying activity in Bank of Valletta cleared all supply at Lm3.60 and even moved higher towards the close of the market, thereby helping the largest local bank in assets term terminate the session 1c9 or 0.5 per cent higher at Lm3.61,9.
On the contrary, selling activity in HSBC Bank Malta, the largest listed company on the Exchange, squeezed the price lower by six-tenths of a cent to Lm1.91,4. Here, the day's activity consisted in 8,500 shares which were swapped across seven transactions.
Maltacom shares inched marginally higher as the equity gained a penny to reclaim the Lm1.40 level. Trading activity remained relatively voluminous when compared to the rest of the trading volumes being affected on the other equities, with 12,796 shares changing hands across seven transactions. The equity has suffered under constant selling pressure after the directors disappointed investors by failing to declare an interim dividend following the publication of six months figures towards the end of August.
Meanwhile, Middlesea Insurance shed 3c or 1.8 per cent as 1,974 shares were swapped at the Lm1.65 level across five transactions. As much as Lm750,000 worth of market capitalisation was destroyed during the session on a mere value of Lm3,257 that was executed on Wednesday.
Elsewhere in the market, buyers and sellers agreed that yesterday's prices provided the correct valuation for the underlying companies and hence traded FIMBank Medserv, Malta International Airport and Simonds Farsons Cisk without change at $1.94, Lm1.60, Lm1.40 and Lm1.05 respectively.
Local bond prices dropped across the board as a relief equity rally in Europe saw investors shifting funds out of the fixed interest market. This activity forced the stockbroker of the Central Bank of Malta to review its prices downwards, with the average decline of approximately 25 basis points.
European and Asian markets rally
Yesterday, European equity markets rallied strongly following the US Federal Reserve's move to cut its main interest rate by half a percentage point to 4.75 per cent. Financial stocks took the lead as the cost of borrowing in the US was reduced. The FTSE Eurofirst 300 rose 2.1 per cent, while in Frankfurt, the Xetra Dax added 1.9 per cent and in Paris, the CAC 40 climbed 2.3 per cent.
London equities made strong gains after the US Federal Reserve's 50 basis points cut in interest rates. After the S&P 500 had seen its best one-day performance in more than four years overnight, the FTSE 100 was two per cent higher at 6,404.5 in morning trade, led by the mining and housebuilding sectors.
Asian stock markets surged on hopes that the US, the region's biggest trading partner, would avoid a serious economic slowdown. Tokyo shares rallied to two-week highs, with the benchmark Nikkei 225 closing up 3.7 per cent and the broader Topix index up 3.8 per cent.
US stocks were poised to extend their biggest rally in four years following gains in Europe and Asia, buoyed by speculation the Federal Reserve's interest-rate cut will help contain the housing slump and spur profit growth.
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.