Financial news

The Malta Stock Exchange Index made a marginal increase of 0.03 per cent at the beginning of this week to read 3,229 points. Five equities were active with only two components registering a change in price. A rise in the share price of the largest local listing by market capitalisation supported the Index. This countered a reduction in the value of International Hotel Investments shares. A total of 29 trades were transacted for a gross market consideration of €73,601.

HSBC Bank Malta was the day's most liquid equity with a total traded volume of 11,180 shares spread over nine trades. Activity started nice and early at the same price with which the equity ended last week. It was only in the dying seconds of trading that the banking equity registered a gain of 5c to close at an intraday high of €2.75.

A single transaction in International Hotel Investments for 2,000 shares lowered the price by a marginal value of 2c5 or 2.79 per cent to €0.87.

Bank of Valletta saw the greatest activity for the session when 9,035 shares were exchanged over 13 deals with a total market value of €32,520. These volumes did not affect the share price, leaving the banking equity at the €3.60 level.

Similarly, trades in Go and Malta International Airport failed to move the previous closing prices of €1.76 and €2.49 respectively.

In the fixed interest sector of the market activity was less than average and spread across just three corporate bonds and five government stocks.

The highest turnover for the session was registered in the 6.35 per cent MGS 2013 (II) and 6.65 per cent MGS 2016 as both saw a volume of 34,941 nominal respectively which were dealt across sole transactions.

The 4.8% MGS 2016 (II) registered the highest increase among the government debt issues trading at the beginning of the week, as the stock gained 113 ticks over a collective volume of 6,989 nominal.

Weekly US economic review

There were no signs of relief from the US economic schedule last week as all figures issued continued to indicate to further economic deterioration. Factory orders have declined by 4.6 per cent in December, higher than the 2.3 per cent expected by market participants.

Housing data did not fare much better as pending home sales dropped by four per cent month on month in November, significantly higher than the 0.7 per cent fall registered in October.

Mortgage applications were also lower, plunging by 8.2 per cent.

Meanwhile, most of last week's focus was reverted to the job figures issued at the end of the week. The number of layoffs in December at -524K was approximately in line with consensus expectations, however, net downward revisions (totalling -154k) to the prior two months make the net effect somewhat worse.

Additionally, the unemployment rate rose to 7.2 per cent from 6.8 per cent previously. The cumulative number of layoffs in the US economy last year was approximately 2.6 million. In other details of the report, the average work week declined by 0.2 hours to 33.3 hours.

The Federal Open Market Committee (FOMC) minutes were also issued late in the week. A significant concern over the economic outlook was again highlighted, while also emphasising that the Fed fund rate may remain exceptionally low for some time.

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.