Locally, the week started with a sudden boost in equities, but progressed in an uneventful manner. The Malta Stock Exchange index closed at 3,120.104, an encouraging rise of 0.9%.
By contrast, foreign equity markets were plunged into deep fog. Political complications in Europe resurfaced, stunning most investors who expected the European deal to symbolise an end to the major crisis. Sudden uncertainty triggered by a decision taken by the Greek Prime Minister created uncomfortable volatility almost on an hourly basis every day of the week as investors worried about the potential outcome, or rather, damage of such a decision.
Furthermore, uninspiring news regarding US jobs last Friday provided no help to markets globally. Persistently high unemployment in the world’s biggest economy continues to have a dampening effect on global strength and investor confidence.
Trading volume in the local equity market returned to normal levels, with nearly 290,000 shares changing hands over the five trading days. Out of the eight equities traded only one ended the week in negative territory. Four others improved, while the remaining three closed the week unchanged.
As has often been the case this year, the bulk of trading last week occurred in Bank of Valletta plc (BoV) shares as nearly 190,000 were exchanged over 145 deals. This volume was spread out very evenly throughout the week. The share price initially soared by 6.25% on Monday closing the session at €2.55. But as the week progressed, this enthusiasm waned, initially slowly, before gathering momentum by the end of the week.
The initial gains were totally eroded with the share price ending the week at the same price at which it had closed the previous week. However, the share price spent four out of five sessions trading above the €2.40 at which it closed the week.
On Friday, BoV announced that the board of directors had unanimously agreed to appoint Charles Borg as chief executive officer with effect from December 19, while Romeo Cutajar will replace Borg as chief officer, Financial Markets and Investments.
Nearly 32,500 Malta International Airport plc (MIA) shares were traded last week spread over five deals. The bulk of trading occurred on Monday at the same price at which it had closed the previous week. But on Friday low volumes led to a 2.29% jump in the share price, which closed the week at €1.79.
MIA therefore continues to gather upward momentum, undoing most intra-year losses and accumulating 7.8% in gains since the start of the year. This performance contrasts sharply against that of the 17.5% loss of the overall index so far this year. On Thursday MIA announced that passenger movements in October rose 4.4 per cent to reach 346,480, the highest number ever registered in October.
A total of 23,400 Fimbank plc shares were exchanged last week, yet all deals were done at $0.72 and therefore closed unchanged for the week. Last week the bank announced that further to a shareholders’ agreement signed earlier this year, it has disbursed its capital tranche representing 40 per cent in Brasilfactors SA.
On the other hand, RS2 Software plc’s share price soared by 3.45% last week, on two deals totalling 14,900 shares. The share price therefore re-hit its yearly highs last week, possibly aiming at breaking through this psychological ceiling.
Trading volume in HSBC Bank Malta plc was minimal last week. Only 14,000 shares were traded, a strong contrast compared to its major counterpart. But this low volume led to a 2.3% improvement with the share price closing the week at €2.70.
Also on Friday, HSBC announced that Alan Richards will be relinquishing his post as chief executive officer with effect from January 1 to take up a new role as chief executive officer of HSBC Indonesia, and will be replaced by Mark Watkinson.
After several weeks of declines, Go plc’s share price managed to s break its losing streak and climb by nearly 4%. But volume was a minimal 9,000 shares. Similarly, low volumes led to Middlesea Insurance plc shedding 2.2% and Plaza Centres plc closing the week unchanged.
Last week, trading in local corporate bonds was fairly active, with nearly €1.034 million worth of bonds being transacted throughout the week.
International Hotel Investments plc announced last week that the Corinthia Hotel Tripoli is gradually returning to normal operations after carrying on operations on a reduced scale. It added that all IHI-owned hotels have registered improvement in their operating performance over 2010, with significant progress at the Lisbon and Prague hotels despite the depressed economic environments in the hotels’ main feeder markets.
The 6.5% IHI plc bond maturing between 2012 and 2014 climbed 2.04% last week to close at €100.
Trading in Malta Government Stocks was also fairly active last week as nearly €4.6m worth of MGSs were exchanged over the five sessions. Prices edged slightly higher as European worries led to a quick rush-to-safety effect and a surprise quarter-point rate cut by the European Central Bank in the first meeting chaired the incoming president Mario Draghi.
Last week the Treasury announced the issue of €100m Malta Government Bonds with an over-allotment option of €44m in the event of over-subscription. The government will be issuing a 4.25% MGS maturing in 2017 (Fungibility issue), a 5.20% MGS maturing in 2031 and €24m in a floating-rate MGS maturing in 2014 linked to the six-month Euribor.
The applications for the fixed-rate MGSs will open on November 14 and close on November 16.
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.