Financial news

The Malta Stock Exchange index dropped more than 15 points, or 0.4 per cent yesterday, as relatively light trading volumes of 60,387 shares across five equities forced the index to fall to the 3,483.985 level.

The biggest move on the day was made by the shares of HSBC Bank Malta plc, which fell by 5c, or 1.7 per cent, to close at €2.90 in five deals for a total of 5,500 shares.

Bank of Valletta plc shares, meanwhile, recovered somewhat from Wednesday’s loss and gained 1c, or 0.3 per cent, to close at €3.66 in robust volume of 37,366 shares across 33 deals. On Wednesday, BOV shares fell 1.3 per cent as investors took profits after Monday’s substantial climb in the share price.

Other shares to trade in the session yet failed to register a change in their closing prices included Go plc, International Hotel Investments plc, and Lombard Bank Malta plc, which finished at €1.870, €0.780, and €2.770 respectively, all on relatively low volume.

Trading in the corporate bond market yesterday remained, as in previous sessions in the week, light as €164,900 nominal across 26 deals were executed. Bonds finished mostly lower with four of the 10 issues to trade in the session closing lower while a single issue finished marginally higher.

The bond to suffer the worst performance in the session was the 6.25% Tumas Investments 2014-2016 issue, which lost €1.80, or 1.8 per cent, to close at €101.20 in four deals for a total of €23,600 nominal.

Weekly UK economic review

In the United Kingdom, the Bank of England kept its interest rate at a record low of 0.5 per cent and its emergency stimulus programme unchanged at £200 billion as the strength of the economic recovery persuaded officials not to join the Federal Reserve in buying more government bonds. In fact, data from the manufacturing industry showed an unexpected increase in activity for the first since March. The Purchasing Managers’ Index (PMI) for October, increased unexpectedly to the highest level since July to a reading of 54.9 from September’s ten month low of 53.5.

In the meantime the PMI for the services industry showed an unexpected growth as the index rose to a reading of 53.2 in October from 52.8 the previous month. This was the highest reading since June and confounding forecasts of a fall to 52.5.

A separate report showed that monetary data continued to show that overall credit is still subdued as the number of British mortgage approvals, although slightly better than expected in September, still fell to the lowest since February at 47,474, down from 47,498 in August. This suggests that the housing market remains fragile, in fact, according to the mortgage lender, Halifax, although house prices increased by 1.8 per cent last month, recovering half of the previous’ month loss, analysts are still expecting the market to soften well into next year.

On balance the data for October suggests that Britain’s economy made a good start to the fourth quarter of this year. In fact, consumer confidence in October unexpectedly rose to a reading of minus 19 from a reading of minus 20 the previous month.

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.