MSE index up 6.6% year-to-date

The Malta Stock Exchange index last week soared to a new high for the year. The index climbed slightly higher in every trading session of the holiday-shortened week so that by the close of Friday's session, it had gained a total of 2.44% over the previous week to reach 3,421.056 points, a level not reached since October last year.

The week was characterised by the reversal of losses in several equities and continued bullishness over other equities. Of the 12 equities traded, eight helped boost the index with steady gains while four reported minor losses. Nevertheless, on a year-to-date basis, the MSE index still has a lot of catching up to do compared to major indices. While the local index has increased 6.6% so far this year, the German DAX and the UK FTSE100 index have both appreciated by nearly 20% this year.

Notwithstanding the shorter trading week, the volume of trading on the local exchange was still on the high side with a total of just over 200,000 shares exchanged in 141 deals.

Go plc accounted for nearly a quarter of last week's trading, with almost 44,000 Go shares changing hands in 34 deals. Investors are still much focused on this equity which has maintained its upward momentum. The share price closed the week at €2.03, or 2.01% higher, surpassing the psychologically-significant €2 mark. Go shares had not reached this price for the past 14 months. Go's performance this year to date has gained nearly 16%, clearly outperforming the overall MSE index.

It is worth highlighting the volume of trading in Lombard Bank plc shares last week. Just over 27,000 shares were exchanged spread across 17 deals, a record weekly volume for this year. Encouragingly, this volume backed a 3.24% rise in the bank's share price, which closed the week at €2.87. Although the equity's performance in 2009 is still slightly in the red, the spike in its price since mid-October is a noteworthy 17%.

Another equity that has climbed steadily since mid-October is HSBC Bank Malta plc, which gained an additional 0.93% last week. Although the share price was driven up early in the week on light volume, subsequent heavy volume supported this higher price to close the week at a €3.25. At one point on Friday, the shares traded at a 2009 high of €3.259. HSBC has advanced just over 20% so far this year.

Trading in Middlesea Insurance plc shares remains hectic and jittery, possibly due to heavy speculation surrounding this stock. The share price fell 5.4% to €0.60 on Monday on light volume, only to be reversed immediately the following trading session on higher volume. The price edged lower on light trading on Thursday and closed the week at €0.63, a minor fall of 0.63%. In total, 33,820 shares were traded in 16 transactions, which is on the high side.

Unlike the above equities, trading in Bank of Valletta plc shares continues to wane week after week as attention turns to other equities. The equity rose slightly higher to close on Friday at €3.78, thereby nearly reversing last week's drop. BoV has remained fairly unchanged for the past month.

The share price has been moving upwards in a stepped manner since March, with occasional spikes as small injections of optimism seeped into the MSE from international financial markets. At a staggering 30.7%, BoV's year-to-date performance remains the highest of all listed equties on the MSE.

Similarly, International Hotels Investments plc's share price also reversed the previous week's 8.5% fall, by climbing 9.3% last week, on similar volume.

Price volatility in this equity remains very high, with significant changes from week to week. Given the equity's large capitalisation, last week's price rise contributed significantly to the MSE index's positive week.

Fimbank plc shares fell to $1.10 (0.9%) in Monday's trading session after 14,054 shares changed hands in three deals.

Both Malta International Airport plc and Simonds Farsons Cisk plc shed value last week, albeit on minor volume. The former slipped 0.46% while the latter dropped 1.2%. Meanwhile, Crimsonwing plc's share price climbed a whopping 19.3% and Santumas Shareholdings plc improved 4%, both on low volume. Two trades led Maltapost plc's share price to rise to €0.651, or 0.15%.

As expected, trading in government and local corporate bonds last week was subdued. The best-performing bond last week was the 7% GAP Developments plc euro bond 2011-2013, which climbed back to €92, a level it had fallen from some weeks ago. Benchmark government bond yields last week were fairly unchanged. Similarly, most Malta Government Stocks that traded last week saw little or no change in prices. Trading in these stocks was very light, amounting to €1 million in value. A total of €4.5 million worth of Treasury Bills were traded.

This article, which was compiled by Jesmond Mizzi, managing director of Jesmond Mizzi Financial Services Ltd (JMFS), does not intend to give investment advice and the contents therein should not be construed as such. JMFS is licensed to conduct investment services by the MFSA. The directors or related parties, including the company, and their clients are likely to have an interest in securities mentioned in this article. For further information contact JMFS at 67/3, South Street, Valletta, Tel: 2122 4410 or e-mail jmizzi@jmfs.net.