Financial news

The Malta Stock Exchange Index fell another five points, or 0.1 per cent yesterday, to close at 3,385.017 points, in moderate volume of 75,775 shares across 42 trades.

Banking shares continued to diverge as HSBC Bank Malta plc shares fell again, dropping 2c, or 0.7 per cent, to close at €2.800 in robust volume of 20,950 across 24 deals while Bank of Valletta plc stock gained 2c, or 0.6 per cent, to close at €3.280 in 13 deals of 18,167 shares. Yesterday’s trading marks the fourth session in the last five that HSBC’s shares have finished lower while BOV’s stock continues to climb higher, coming off its recent low of €3.180 in early September.

Also in the banking sector, FIMBank plc had the day’s worst performance, shedding 4c, or four per cent, to close at US$0.950 in four trades of 35,000 shares.

The other stock to trade in the day was that of Middlesea Insurance plc, which witnessed a single trade of 1,658 shares take place, boosting its share price by 2c, or 2.2 per cent, to close at €0.950.

Trading in the corporate bond market continued to suffer from lack of investor interest as €154,800 nominal across 22 deals were traded. Bond prices finished mixed as three of the 10 bonds to trade in the day ended lower while five closed higher. The big mover on the day was the seven per cent MIDI 2016-2018 issue, which gained 2.2 per cent, to close at €107.3000 in a single trade of 4,600 nominal.

Weekly US economic review

Economic growth in the United States, was upwardly revised to an annualised rate of 1.7 per cent in the second quarter of this year from the previous estimate of 1.6 per cent issued last month. This revision was mainly attributed to higher consumer spending, which grew at the fastest pace in three years and also by a bigger accumulation in business inventories than previously thought. In the first three months of this year, the world’s largest economy grew 3.7 per cent and five per cent at the end of last year.

On a negative note, data from the manufacturing sector showed that this expanded at a slower pace during September. The Institute for Supply Management’s factor index dropped to a reading of 54.4 from a level of 56.3 the prior month. Factory orders during the month of August declined more than the forecasted 0.5 per cent, reversing the upwardly revised increase of 0.5 per cent which was registered the previous month.

Elsewhere, consumer spending increased by a higher than forecast 0.4 per cent for the second consecutive month, while real disposable income rose 0.5 per cent in August. With income rising faster than spending, the personal savings rate rose to 5.8 per cent of disposable income from 5.7 per cent in July.

Finally, in the housing market, pending home sales hit a four-month high in August as this increased by 4.3 per cent. This was much higher than the 2.5 per cent which was expected by various analysts and shows a sign that the housing market was stabilising at very low levels following its previous sharp drop after a home-buyer tax credit expired.

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.