Large caps losses hit index negatively

The Malta Stock Exchange index extended its recent negative stance by recording a significant loss of two per cent to close the week at 2,994.256 points, thus returning a negative 3.3 per cent year to date. Following a shortened week due to yesterday’s holiday, the index experienced a torrid week as it traded in negative territory in three out of four sessions. The fall was also due to the considerable losses recorded among highly capitalised equities, where International Hotels Investments plc headed the list of losers. The week witnessed the trading of 11 equities, in which losers outperformer gainers, as eight depreciated in value, two posted gains, while Simonds Farsons Cisk plc closed unchanged.

In the Corporate Bonds market, turnover declined further this week to nearly €0.4 million. Out of the 28 active issues, only eight bonds recorded price changes. The 5.35% Bank of Valletta 2019 lost 0.5 per cent while the 7% FIMBank EUR 2012 – 2019 gained almost one per cent.

Meanwhile, in the Government Bonds market on a general note bond prices retreated slightly, as upbeat international equity markets pushed down prices of safe Government Bonds, which tend to be inversely related. However, turnover was significantly lower on the week reaching €3 million, down from over €7 million last week. Fourteen issues were active with the 5.1% MGS 2014 being the most active.

From the equity market, financials were on the downside with the exception of Bank of Valletta plc. In fact, the banking equity recorded a scant gain of 0.2 per cent to close the week at €2.215. The equity was active throughout the whole week as it shifted from positive to negative in the first two sessions, while it close flat and posted a minimal gain in the following two. This week a total of 30,525 shares changed ownership over 35 transactions. Earlier in the week Fitch Ratings, a rating agency, affirmed the Bank’s Long-Term Issuer Default at BBB+, which reflects BOV’s strong funding base, satisfactory liquidity and adequate profitability. Fitch added that the ratings reflect the bank’s reliance on the country’s small and concentrated economy and its asset quality.

On the contrary, HSBC Bank Malta plc surrendered 0.8 per cent of its recent gains to close the week at €2.55. The equity was active in three sessions as it incurred the weekly loss on both Monday and Wednesday, while it recoded a minimal gain of 0.2 per cent on Tuesday. Activity was relatively weak, as total turnover amounted to 7,490 shares traded across nine deals.

Likewise, FIMBank plc continued its gradual fall by registering an additional loss of two per cent on Wednesday to reach the $0.75 price levels.

Similarly, investors’ negative mood towards financials darkened further as Middlesea plc shares plummeted by a further 2.6 per cent on Wednesday to end the week at €0.70. In the week, a total of 10,176 shares were traded across three transactions. On Monday, the company announced that the board of directors is scheduled to meet on Tuesday, February 28, 2012 for the consideration of and approval of the financial statements for the year ended December 31, 2011 and for the recommendation of any possible dividend.

The other active financial, Lombard Bank plc, declined by a further 0.8 per cent over 20,390 shares, which were executed across three trades to end the week at €2.53.

From the hoteliers industry, International Hotels Investments plc plunged by a heavy 8.5 per cent over a single session on Monday to close the week at €0.75. A total of 8,244 shares were traded over five transactions.

Meanwhile, from the telecommunications sector, Go plc faltered by a further 3.4 per cent or €0.03 to close at €0.86. The equity was active in three sessions with Tuesday being the worst session as it recorded a loss of 3.3 per cent.

During the week, equities within the I.T. industry fell sharply out of favour. In fact, Crimsonwing plc slumped by a heavy 18.2 per cent over high volumes of 61,746 shares to end the week at a new record low of €0.18. Likewise, following the late positive stance, RS2 Software plc shares dwindled by a sharp 8.3 per cent on Monday to end the week at €0.60. The equity was active in two sessions this week were a total of 70,000 shares were traded over six transactions.

On a positive note, Maltapost plc snapped back most of its recent losses by gaining three per cent over thin trading of 512 shares to re-gain the €0.99 price levels.

This article, which was com­­piled by Atlas JMFS Investment Services Limited, does not intend to give investment advice and the contents therein should not be construed as such. Atlas JMFS is licensed to conduct investment services by the MFSA and is a member firm of the Malta Stock Exchange.

The directors or related parties, including the company, and their clients are likely to have an interest in securities mentioned in this article.

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