Local equities completely ignored the worldwide equity bloodbath to reverse a four-day losing streak with renewed buying activity in HSBC Bank Malta and International Hotel Investments helping the MSE Index close yesterday's session higher by 0.2 per cent at 4,963 points.
Investors seemed immune to Friday's announcement by Go that, together with Emirates International Telecommunications Ltd, the majority shareholders in Go, the company is evaluating the possibility of acquiring a stake of an undisclosed telecommunications company in Greece.
In fact, initial trading activity was conducted at Friday's closing level of €3.04 but as the day progressed the price moved lower on further selling activity which settled down at €3.02. Nevertheless, the equity attracted the highest value of turnover with deals struck for transactions worth €117,847.
Buying activity in HSBC Bank Malta consisted of 22,960 shares which were exchanged across 13 transactions. The equity recouped 2c or 0.4 per cent to €4.87 in the process leaving a further 1,900 shares unfilled on the offer side at this level against supply of 990 shares best bid at the €4.74 level.
Bank of Valletta tentatively moved higher during the session touching the €6.78 level before sellers reversed the gains completely and the equity closed unchanged at €6.75. During the session a total of 8,615 shares were struck across 10 deals.
Meanwhile, FIMBank closed weaker by 0.5 per cent at $1.75 as 22,089 shares changed hands across two trades.
International Hotel Investments gained a full percentage point on a two fairly largish buy orders which cleared 61,864 shares off the offer side at the €1.01 level, while elsewhere a single deal in Grand Harbour Marina saw the equity trade for the first time since euro adoption and was executed at the €1.70 level which represents a 4c7 or 2.7 per cent discount to its previous closing level. A single transaction in Crimsonwing was struck without altering its previous price of €0.55.
US economic review - weekly round-up
Pessimism continues to reign over the US economy. Housing starts and permits plunged again in December - housing starts declined 14.2 per cent which included a decline in all four American regions. The northeast and the Midwest declined 25.8 per cent and 30.8 per cent respectively while the south and the west declined a comparatively small 3.3 per cent and 19.6 per cent. Regarding permits data, they showed an 8.1 per cent decline in December. Residential investment is expected to continue to drag on the economy. A bottom is not likely to be reached until next quarter.
Further evidence of the negative sentiment emerged from the Philadelphia Federal Manufacturing Index. The Index dropped 19.3 points to -20.9, which is the lowest since the recession of 2001. The sub components to the index showed a decline in new orders and shipments and, for the first time since December 2003, there was a decline in employment.
Also last week the Atlanta Federal Reserve published the Beige Book, which covered the state of the economy from early December through the first week of this year. The report described the economy as slowing but not declining. Residential weakness was described as "quite weak" and job losses in this sector were reported, which comes at no surprise. Inflation remains stubborn amid high input prices. The report has been largely interpreted as being consistent with the view that the economy is facing a significant slowdown, but not a recession.
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.