Financial news

Trading activity during the mid-week session on the Malta Stock Exchange was dominated by the two largest local banking equities, while the index closed practically unchanged at the 3,025.9 level. In the equity market investors transacted an aggregate of 11 deals over three different listings.

Bank of Valletta headed the list of gainers during yestereday's session as the equity rose by 3c or one per cent to close above the €3 level at €3.03, thus the equity rose by a total of 7c over these past two days. The financial services company actively traded 2,521 shares over four deals.

On the contrary, HSBC Bank Malta ended in red as the equity shed 2c or 0.8 per cent to terminate at €2.65. During the first two days of the week the bank's activity was characterised by low trading volume that resulted in status quo for the equity's price. Yesterday's session was different even where volume is concerned as investors swapped 13,750 shares over six deals for a market consideration of €36,512.

Malta International Airport was the only non-banking equity to be active during the day's trading session. The airport operator also registered a marginal increase during the day as it rose by 2c which equates to an increase of almost one per cent. However, trading activity was subdued as two investors swapped a mere 685 shares.

Weekly eurozone economic review

The economic highlights in the eurozone over the past week were largely focused on employment figures and the European Union's Commission growth forecasts.

Eurozone employment in the second quarter fell 0.5 per cent from the previous three months or by 702,000 people. This brings the total people without a job to 145.6 million.

Meanwhile, labour costs jumped in the second quarter despite a fall in employment and a rise in joblessness. In fact, hourly costs in the 16-country euro area rose four per cent in the April-June quarter against the same period of 2008. On a negative note, industrial output in the eurozone dropped during the month of July, as it fell by 0.3 per cent, while economists had expected a 0.2 per cent monthly decline.

The European Commission in its growth forecasts said that the euro-zone is emerging from the recession, although it kept a gloomy forecast for 2009 despite an improved outlook for the second half of the year.

In its interim forecasts, the eurozone economy would contract by four per cent this year. Meanwhile, the fiscal stimulus should be kept in 2009 and 2010, but the eurozone and the EU should map out an exit strategy, with budget deficits across the bloc expected to be higher than previously thought.

Regarding eurozone inflation, the Commission said that in 2009 it's keeping its May forecast at 0.4 per cent, adding that while inflation risks are broadly balanced, the risk of deflation has diminished because of a rise in commodity prices.

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.