Financial news

The Malta Stock Exchange dropped another 12 points, or 0.4 per cent yesterday, following Tuesday’s slight pull back of 10 points, to close at 3458.942. Investors were difficult to find as a mere 14,101 shares exchanged hands in 10 deals across a total of three equities.

The banking sector remained the market mover on the day as HSBC Bank Malta plc lost three cents, or one per cent, to close at €3 in seven trades of 11,276 shares. Earlier in the week HSBC’s shares were up more than four per cent in robust volume of over 34,000 shares.

Bank of Valletta plc, meanwhile, managed to stem some of the losses it witnessed on Tuesday and climbed 0c1, or less than 0.1 per cent, to close at €3.202, in two trades of 825 shares. On Monday, BOV shares jumped almost six per cent only to retreat 1.5 per cent on Tuesday.

At the end of yesterday’s trading session, the best unsatisfied bid stood at €3.24 for 1,062 shares while the best unsatisfied offer stood at €3.28 for 325 shares.

The other issue to trade in the session was Malta International Airport plc, whose shares sank 1c9, or 1.2 per cent, to end the day at €1.561. Late last week, budget airline Easyjet, announced that it will be accepting bookings for new flights from Belfast International Airport to Malta, starting on February 11, 2011.

Weekly eurozone economic review

In the eurozone, the European Central Bank (ECB), as expected, kept its main interest rate on hold at a record low of one per cent for the 14th straight month. The ECB also kept its overnight deposit rate, at 0.25 per cent and its marginal lending rate at 1.75 per cent. In the meantime, the inflation rate for the eurozone was confirmed at 1.4 per cent during June, as expected and down from 1.6 per cent registered during May. On a month-on-month basis, inflation pressure in the 16 countries using the euro was flat, also in line with its earlier flash estimate. This shows that inflationary pressures in the eurozone remain weak.

In the manufacturing sector, industrial production remained steady as this increased by a further 0.9 per cent during May, although weaker than expected. On a year-on-year basis, industrial production surged more than in any month in almost two decades, since the eurozone began in January 1991, as production increased by 9.4 per cent in May after an upwardly revised 9.6 per cent increase registered in the previous month. This shows that the recovery in the export-sensitive industrial sector has not been affected yet by the region’s fiscal problems.

Finally, in Germany, investor confidence as measured by the ZEW economic sentiment survey declined for the third month in July. The index which aims to predict developments six months ahead, fell to a 15-month low of 21.8 in July from a reading of 28.7. Among the several reasons why analysts are currently less confident about Germany’s economic prospects than they were a few months ago, are: the debt crisis in the euro-zone, the present banks’ stress tests necessary to prove their durability and growing fears of a double-dip in America.

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.