Financial news

The Malta Stock Exchange pulled slightly back yesterday, dropping just over 10 points, or 0.3 per cent, as investors took some of Monday's profits off the table. The Index closed at the 3471.177 level.

Bank of Valletta plc, which was Monday's high flyer, gave back 4c7, or 1.5 per cent yesterday, closing at €3.201, in light volume of 2,445 shares across four deals. On Monday the local retail bank surged 5.8 per cent higher. Monday's other high flyer, HSBC Bank Malta plc, finished unchanged yesterday, as 10,745 shares exchanged hands across nine trades so see its shares close at €3.03.

The remaining issuer in the banking sector to trade on the day, Lombard Bank Malta plc, gained 2c1, or 0.7 per cent, to close at €2.91 in a single trade of 175 shares.

GlobalCapital plc, whose shares last traded on May 19, closed unchanged at €1.50 in a single trade of 370 shares.

Middlesea Insurance plc, meanwhile, regained its upward momentum after closing down on Monday, as shares in the Floriana-based insurance company rose 0c2, or 0.2 per cent, to close at €1.15 in a single deal of 500 shares.

In the tourism sector, Malta International Airport plc closed unchanged at €1.58 in 11 deals of 6,380 shares while Island Hotels Group Holdings plc lost 0c1, or 0.1 per cent, in three deals of 5,000 shares to close at €0.999.

The other equity to trade in the session was Go plc, whose shares closed unchanged at €1.90 in five trades of 5,800 shares.

Weekly US economic review

In the United States, the services sector expanded for the sixth straight month in June, but growth was at the slowest pace since February as the Institute for Supply Management Index, which covers about 90 per cent of the economy, fell to a four-month low of 53.8 from a reading of 55.4 in May. This was less than forecasted and shows that the economic recovery is cooling down.

In the meantime, consumer borrowing dropped more than forecast during May, as consumer credit fell by $9.1 billion after falling by a sharply downward revised $14.9 billion the previous month. This shows that Americans are less willing to take on debt without an improvement in the labour market. In the labour market, jobless benefits fell more than forecasts. The number of Americans claiming unemployment benefits decreased by 21,000 in the week which ended on July 3 to a reading of 454,000, down from an upwardly revised 475,000 reading the previous week. In the meantime, the number of people continuing to receive benefits in the final week of June declined to 4,413,000 from a level of 4,637,000 the previous week, the lowest in seven months. However, these indicators remained at a level that indicates unemployment will be slow to decline.

Finally, the level of inventories increased by 0.5 per cent during the month of May, recording the fifth consecutive monthly increase. This was highest than forecast and followed a rise of 0.2 per cent gain the prior month. Also on a negative note, sales at distributors dropped 0.3 per cent, the first decline since March 2009, after increasing by 0.9 per cent the previous month.