Positive sentiment sends MSE index higher
The Malta Stock Exchange Index (MSE) closed higher for the second week, having gained 0.6 per cent last week, the highest week-on-week gain over the past four weeks. The MSE index closed at a 13-week high at 3,269.045 points as sentiment improved yet turnover declined further to €0.8m down from €1m a week earlier. In terms of value the two major Banks dominated activity followed by MaltaPost plc. Out of 22 listed equities on the local market, 17 shares were active, of which 12 gained, three closed lower and another two ended the week flat.
6PM Holdings plc topped the list of gainers with an impressive 45 per cent gain, following a company announcement early in the week, while gains in Go plc and International Hotel Investments plc helped to push the local index higher. In the banking sector, the two major Banks moved in opposite direction as HSBC Bank Malta plc (HSBC) closed the week higher Bank of Valletta plc lost some ground while FIMBank plc traded unchanged at $1.
In the fixed-income market Malta Government Stocks (MGS) dominated activity ahead of the new issues which are expected to open for subscription tomorrow. Turnover in this sector of the market reached almost €15m, up from €9.6m a week earlier. Running yields closed generally higher as prices declined yet some long-dated issues managed to close the week higher with the 5.25% MGS 2030 heading the list as it improved by 80 basis points to end the week at €106.97. Tomorrow two new MGS issues will be available to investors namely, the 3% MGS 2019 which will be offered at €100.50 and hence giving a yield to maturity of 2.915 per cent and the 4.5% MGS 2028 will be offered at a price of €100.
Back to the equity market, HSBC shares gained 0.7 per cent or €0.02 as the equity closed at €2.76 after 11 deals worth €118,000 were executed. The banking equity started off the week with a minimum gain which it completely shed on Tuesday as volume declined while in the closing two sessions the equity’s price improved as turnover increased. The Bank is expected to publish is preliminary results for 2012 on March 4.
On the other hand, Bank of Valletta plc shares lost 0.4 per cent to end the week at €2.27 after the equity touched a weekly low on Tuesday of €2.26 while it closed higher in the following three sessions. Yet gains were not enough to outweigh the one per cent decline recorded on Tuesday. Since the beginning of the year the equity is up by over four per cent.
Lombard Bank plc gained 0.5 per cent having traded at €1.90; the equity’s price barely moved over three transactions of 16,600 shares. Meanwhile, Malta Post plc gained one per cent closing the week at €1.05 after 101,000 shares were dealt across 25 deals. On Tuesday the postal operator issued its Interim Directors’ Statement in which it stated that profitability has improved when compared to the corresponding period last year. The company added that on-line retailing continues to impact positively the parcel volumes while increases in local tariffs mitigated somewhat the declined witnessed in cross border mail tariffs.
Go plc shares gained 1.5 per cent as it ended the week at the €1.40 level as over 41,000 shares were traded across 15 deals worth €57,000. The equity closed flat in the opening two sessions while it moved higher in the final three trading days. As a result of last week’s gain since the beginning of the year the telecoms company has returned nearly 18 per cent.
Likewise, International Hotel Investments plc gained 1.2 per cent to end the week at €0.75 as three deals of 10,000 shares were executed. Meanwhile, Island Hotels Group plc edged minimally lower as low turnover continues to characterise trading in the hotels operators.
On the other hand, in the IT sector 6PM Holdings plc gained a hefty 45 per cent or £0.13 to end the week at £0.42. Following a company announcement late on Monday, the equity’s price soared by 38 per cent as trading volume spiked while gained further ground in another two sessions as demand declined. The company announced that it has successfully licensed its Care Solutions Climate-HIV management solution to three UK trusts forming part of the National Health Services. 6PM also announced that it has won a bid for a major project worth over £2m with one of the largest hospitals in the UK.
On the other hand, Crimsonwing plc lost 1.8 per cent closing the week at €0.54 while RS2 Software plc closed flat at €0.86.
Meanwhile, MIDI plc gained 3.9 per cent mid-week yet just one deal of 2,000 shares was recorded. Malita Investments plc gained two per cent to end the week at €0.53 while Plaza Centres plc gained almost one per cent on thin trading.
Abroad, equity markets closed the final session of the week on a high yet the week proved somewhat bumpy for equity investors as markets fluctuated between positive and negative territory as investors reacted to the news flows and data out of the US and Europe.
In the US markets The Dow Jones Industrial Average closed marginally up and reached the 14,000 level while the Nasdaq and the S&P 500 Index closed the week in negative territory. The S&P 500 registered its first week loss for 2013 while in Europe major indices ended the week in positive territory. All this occurred as early in the week risky assets took a nose dive after concerns that the Federal Reserves’ (FED) monetary easing practices have created a bubble in risky assets. However, on Friday FED chairman Ben Bernanke talked down these concerns. Moreover, on Friday, sentiment took a turn for the better after German business confidence jumped to a 10-month high in the midst of better than anticipated corporate earnings. Meanwhile, late on Friday, rating agency Moody’s downgraded the UK from triple A to Aa1, thus causing sterling to fall to a two year low against the US dollar.
This article, which was compiled by Jesmond Mizzi, managing director of Jesmond Mizzi Financial Advisors Ltd, does not intend to give investment advice and the contents therein should not be construed as such. The company is licensed to conduct investment services by the MFSA and a member of the Malta Stock Exchange and a member of the Atlas Group. The directors or related parties, including the company, and their clients are likely to have an interest in securities mentioned in this article. For further information contact Jesmond Mizzi at 67, Level 3, South Street, Valletta, or on Tel: 2122 4410 or e-mail [email protected].