Financial news

Activity on the local equity market was once again subdued with trading limited to the larger banks which alas traded on very low volumes. The MSE Index ended broadly flat on the day, increasing by a meagre 0.07 per cent to 3,023.15 points, ending a two-day losing streak.

HSBC Bank Malta opened higher yesterday but failed to attract increasing support throughout the session to end the day unchanged at €2.66. The equity has been on a downward trend since reaching the €3 level at the end of last month. Total activity for the day consisted of 4,060 shares spread over five deals.

Bank of Valletta was the only equity to register a gain during the session, ending a three-day losing streak which has seen the equity retreat from a recent high of €3.04 reached at the end of August. A total of 2,666 shares changed hands throughout the session spread over four deals, with the share price advancing by €0.011 or 0.4 per cent to end at €2.96.

Activity on the corporate bond market was sustained by good volumes but with limited price volatility. The 6.7 per cent Eden Finance which is due to be redeemed next year was the only bond to register a gain, advancing by one per cent to reclaim the par level. The only other bond to register a change in price was the 5.35 per cent Bank of Valletta subordinated bond 2019, issued earlier this year, which decreased by 10 ticks to end the day at €104.30.

On the sovereign debt market the day's activity was characterised by marginal decline in prices and some large volumes transacted in the 5.7 per cent MGS 2012 (III). This issue registered a single trade for a significant €3.7 million nominal. Total activity for the session was spread over 10 issues and 14 deals.

Weekly UK economic review

The economic indicators emanating from the United Kingdom during the past week were largely focused on the Bank of England's meeting yesterday. Elsewhere, economic data was largely positive, both in the manufacturing sector as well as in the services sector.

The BOE as expected left interest rates unchanged at 0.5 per cent for the sixth month running and said that it would keep its £175 billion asset buying programme in place.

British manufacturing output rose at its fastest monthly rate in one and a half years helped largely by a sharp increase in car production. In fact, factory output rose 0.9 per cent in July after it registered a revised increase of 0.6 per cent in June. Activity in Britain's services sector grew at its fastest pace in nearly two years in August, increasing to a reading of 54.1 from 53.2 in July. This was largely boosted by a surge in optimism about an economic recovery. In fact, UK consumer morale hit its highest in more than a year in August, as the Nationwide Consumer confidence Index rose to 63 from an upwardly-revised 61 in July.

British exports also rose to their fastest monthly pace since the start of 2008 in July, as the value of UK exports rose five per cent to £19.2 billion, while the value of imports rose by 3.5 per cent to £25.7 billion. Retail sales fell last month for the first time since May as cost-conscious consumers refrained from buying non-essential items. In fact, sales fell 0.1 per cent in August compared to the same month last year after a 1.8 per cent annual gain in July.

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.