Financial news

Yesterday's trading session at the Malta Stock Exchange saw more losses as the Index shed a further two per cent to close the day at a multi-year low of 2,802 points, thereby registering its ninth consecutive session of negativity. Trading activity was relatively wide spread as seven different equities were active for the day.

Bank of Valletta was the most active equity as trading was spread over 33 deals albeit registering another significant loss of 10c or 4.78 per cent in share price, to close at an intraday low of €2.03.

Reversing the positive outing during Monday's session, HSBC Bank Malta was another laggard as the equity declined by a further 10c or a 4.27 per cent, to terminate the session at €2.24, which is also a new low for the company.

More of the same story was registered in Lombard Bank Malta as the banking equity lost 2c on the exchange of 2,000 shares spread over a single deal. The financial services company like its banking counterparts closed at a new low of €2.46.

Similarly Plaza Centres traded on low volume as the equity exchanged a single deal for a market consideration of €5,037. The listing incurred a negligible loss in price of one-tenth of a cent to end at €1.68.

The 6pm Holdings, Simonds Farsons Cisk and Middlesea Insurance were the non-moves for the day as the equities ended the session unchanged at €0.59, €1.90 and €2.57 respectively.

In the fixed interest sector of the market activity was spread over seven corporate bonds and four government bonds. The highest turnover was registered in the 5% MGS 2021(I) as a total of 604,659 nominal were transacted over three deals and a market value of €624,795. The shorter dated MGS 2012 was the only government issue trading on the downside, while activity in the corporate sector was relatively mixed with no particular direction in bond prices.

Weekly eurozone economic review

Data releases in the eurozone continued to point south. The composite Purchasing Manager Index (PMI), a key leading indicator of activity, fell to a new low, suggesting it is premature to believe that the economy has hit the bottom. The manufacturing component gave up the modest gains it made in January and services fell sharply, dipping below 40 for the first time in the series' 12-year history (a reading below 50 indicates contraction). The fall in composite PMI index from 38.3 to a new low of 36.2 was far weaker than the consensus expectation for a small increase to 38.5.

Industry output was yet another disappointment as demand for transport, equipment, machinery and metals plunged in the eurozone for the month of December. Industrial new orders in the 16 countries using the euro in December fell 5.2 per cent month-on-month and 22.3 per cent year-on-year.

Meanwhile, Germany's ifo sentiment index failed to inject any optimism. The headline index fell from 83.0 to a new record low of 82.6 (consensus 83.1). However, it is at least vaguely encouraging that the index has been broadly stable over the past three months following the previous significant falls. Nonetheless, this is the weakest reading since data for a reunified Germany began in 1991.

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.