Financial news

The Malta Stock Exchange witnessed very light trading yesterday with only five issues trading hands and three issues ending the session with a change in its closing price. The MSE equity market managed 33 deals on volume of 61,418 shares, with the Index closing at 3584.046, down 0.6 per cent.

The big mover on the day was International Hotel Investments plc whose stock closed down 3c5, or 4.4 per cent, in a single trade of 2,982 trades.

The local telecom operator, Go plc, also lost ground yesterday as 18,500 shares exchanged hands in 13 deals to close down 2c1, or 0.9 per cent.

Meanwhile, on the upside, was Bank of Valletta plc. The bank's shares traded in negative territory throughout the session but managed to finish up 1c5, or 0.5 per cent in 11 trades of 7,150 shares in aggregate. Bank of Valletta stated on Monday that its recent €50 million 4.80 per cent subordinated bond issue had been oversubscribed, with the bank deciding to exercise the full over-allotment option of €20 million. The bank closed its subscription lists within hours of its opening.

Other shares which traded throughout the day but closed unchanged were Lombard Bank Malta plc, which closed at €3.09, on volume of 4,586 shares and Maltapost plc which closed at €0.79, in continued heavy volume of 28,200 shares.

Weekly US economic review

In the United States, the Institute for Supply Management's index (ISM) for the service industries, which covers almost 90 per cent of the economy, increased to a reading of 53.0 in February up from the 50.5 registered the previous month. Meanwhile, new factory orders rose by 1.7 per cent during January, from an upwardly revised 1.5 per cent in December 2009. This was the ninth increase of the last 10 months and was mainly driven by an increase in transportation equipment.

A busy week for labour market data showed that the US economy lost a net of 36,000 jobs in February, after a revised drop of 26,000 in January. Increases in the manufacturing sector and in the service sector were offset by falls in the construction and public sectors. The increase in the services sector was mainly driven by an increase in temporary employment due to the uncertainty over the sustainability of the recovery.

The unemployment rate, which has not increased since October 2009, remained unchanged at 9.7 per cent last month. In the meantime, initial jobless claims for state unemployment benefits declined by 29,000 in February, to a seasonally adjusted figure of 469,000.

In the housing sector, the Pending Home Sales Index which is based on contracts signed in January, fell a more than expected 7.6 per cent to a 10-month low. This compares to a downwardly revised increase of 0.8 per cent in December. The data shows that the extension of a tax credit is not affecting the market yet.

Finally, according to Federal Reserve data, consumer credit in January rose for the first time in a year by $4.96 billion after a decline of $4.60 billion in December 2009.

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.