Financial news

The Malta Stock Exchange registered yet another bland session, as all the equities trading yesterday closed the session relatively unaltered. The MSE Index closed at 3,338 points with just three equity components active throughout the session. Trading activity was relatively low with 15 deals being struck in the local equity market for a total consideration of €32,567.

A sole deal of 1,000 shares in Grand Harbour Marina was transacted midway through the session with the share price losing a further 5c or 2.7 per cent to close at €1.80. This negative streak began a month ago, after the last company announcement, where the marina operator highlighted that its financial performance during the nine months to September 30 continues to exceed that achieved during the same period last year.

However, it was also stated that the results for the last quarter of the financial year ending December 31, were exceptional and unlikely to be repeated.

Bank of Valletta was the most active and liquid traded listing with a total of 7,930 shares being exchanged across 13 trades. The equity's intraday high was set at a price of €3.615, dealt close to the start of the session, but this gain was soon forfeited thereby leaving the equity price unchanged at €3.61.

HSBC Bank Malta was also a non-mover, when a mere 732 shares were exchanged between two investors, thereby leaving the previous closing price of €2.91 unaltered.

In the fixed interest sector of the market, activity was spread across five corporate bonds and three government stocks. The 6.7 per cent Mizzi Organisation Finance 2009/12 attracted the highest turnover, with 158,257 nominal, inching higher by 0.25 per cent at €101.

The highest percentage increase in the local bond market was registered in the 7.5% Mediterranean Investments Holding 2012/14 when 126,520 nominal were swapped at a price of €101.80 therefore trading up by 0.79 per cent.

Weekly eurozone economic review

Euro area Gross Domestic Product contracted by 0.2 per cent quarter on quarter for the second consecutive three-month period, meeting the technical definition of a recession. Having narrowly avoided a sustained contraction in 2001, this is the first official recession since the euro area began in 1999. Results across the large member states were more mixed than expected in the third quarter. Germany and Italy lead the contraction with 0.5 per cent quarter on quarter declines. France confounded consensus with mild growth, while Spain recorded its first decline in output since the early 1990s.

Meanwhile, the European Central Bank Governing Council member and head of the Bundesbank Axel Weber did not rule out that the eurozone economy could shrink over the next year as the International Monetary Fund is predicting. Mr Weber stated that "the growth outlook has dimmed quite noticeably". He also added that interest rates could be lowered again in response to the current market adversities, as long as inflation pressures did not re-emerge.

Inflationary figures were reconfirmed by Eurostat last Friday as inflation in the eurozone was zero on a monthly basis in October, confirming earlier estimates that price growth slowed to 3.2 per cent year on year from September's 3.6 per cent.

Although still above the two per cent target rate, Mr Weber also stated that inflation rates are expected to drop noticeably and approach the target rate in 2010.

This article has been prepared by Bank of Valletta p.l.c. (the Bank), which is licensed to conduct investment services business by the MFSA, for your general information only. This information is not a solicitation or offer by the Bank to acquire or sell securities. Nor does it constitute any form of advice by the Bank. Appropriate advice should be obtained before making any such decision. Past performance is not necessarily a guide to future performance and the value of your investments may fall or rise.