The Malta Stock Exchange index sustained its ongoing downward trend last week, ending 0.52% lower by Friday’s session. The index reached 3,273.164, a new low for the current year, with the total loss since January surpassing 13.4%.
Losses were widespread last week, yet volumes failed to impress, though this is typical during this time of year. The index initially improved on Monday, yet selling pressure took over thereafter, with every remaining trading session seeing the index edge lower.
The local equity market performance has once again disappointed compared with most indices abroad which saw a sudden shift in mood following better-than-expected earnings results and an indication of an agreement regarding a possible Greek bailout plan.
Trading volume totalled 153,000 shares, which is much lower than what used to be traded in the first few months of the year.
Half of last week’s trading was unusually concentrated in two lowly capitalised equities. The remainder was spread sparsely among a further 12 companies.
Only two equities ended the week in positive territory while eight ended in the red. Four shares closed the week unchanged.
For the second week in a row, trading in RS2 Software plc shares was unusually high. Last week a total of 50,000 RS2 shares changed ownership, with the share price initially improving to €0.54, but the gain was reversed by Friday’s session. The equity price therefore ended the week unchanged at €0.53.
Trading in Bank of Valletta plc totalled just over 38,000 shares, which is still a far cry from its level of weekly trading in previous months. An attempt to increase the price to €2.70 early in the week was immediately undone, with the price actually moving lower to €2.65, backed by the bulk of the week’s volume.
The negative trend therefore was kept intact, with the equity heading further towards its year-to-date low.
Last week BoV announced that in view of the overwhelming acceptance rate to the offer relating to the La Vallette property fund, the bank and Valletta Fund Management have elected not to proceed with their intended appeals against the conclusions of the Malta Financial Services Authority regarding the issue.
Trading in Crimsonwing plc was typical, with a total of 22,620 shares exchanging hands. This trading dragged the share price lower by 2.82%, with the equity’s year-to-date losses now accumulating well beyond the 9% mark.
Trading in the remaining 11 companies ammounted collectively to just over 42,000 shares last week. Maltapost plc managed to close the week with very a modest gain, closing at €1. HSBC Bank Malta plc also improved by a minimal 0.7%.
Light volume led to some hefty losses for Go plc and Lombard Bank plc, with the latter shedding 6% while the former fell by 4.41%.
Minimal volume led also to further drastic losses, particularly for 6PM plc, with a weekly drop of 12.5% in its share price, and Santumas Shareholdings plc, with a large decline of 16%.
Much more moderate losses were recorded by Malta International Airport plc and Medserv plc.
Last week MIA announced its detailed traffic results for the period January to June. It said passenger movements at the airport grew by 12.7% in the first six months of the year compared with the corresponding period of 2010.
All core markets registered an increase in the first half of 2011, with the UK being the top destination. MIA expects passenger movements to reach 3.4 million in 2011, an estimated increase of 3.2% over 2010.
Island Hotels Investments plc, Simonds Farsons Cisk plc and Global Capital plc all saw minor trading, leading to unchanged share prices.
Last week there was a total of €0.5m worth of trading in the local corporate bond market, with bond prices generally remaining unchanged throughout the week.
An exception was the 6.78% increase in the 7.15% Mediterranean Investment Holding euro bond maturing between 2015 and 2017.
Last week Bank of Valletta plc announced it had been granted approval by the listing authority for the official listing on the Malta Stock Exchange of a €125m Debt Issuance Programme.
The maximum aggregate principal amount of notes that the bank may issue under the programme will not exceed €125m (or its equivalent in other currency).
BoV also announced that it will be offering to the general public the first series and tranche under the programme of €40m 4.80% per annum notes due in 2018.
Subscriptions will open on Thursday and close on August 3 or earlier in case of oversubscription.
Meanwhile, just over €5.7m worth of Malta Government Stock were traded last week.
Given that risk aversion dissipated somewhat, particularly in Europe, most benchmark government yields improved over the week, resulting in a fall in most safe prices. This was mimicked on the local MGS market which saw a general fall in prices across most issues.
This article, which was compiled by Jesmond Mizzi, joint managing director of Atlas JMFS Investment Services Ltd, 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. For further information contact Atlas JMFS at 67/3, South Street, Valletta, or on Tel. 2122 4410 or e-mail jesmond.mizzi@atlasjmfs.com.