Trading activity for yesterday's session at the Malta Stock Exchange was focused in the fixed interest sector of the market as there were no equities active during the session. Thus the Index remained static at yesterday's closing level which stood at 2,949.47 points. In the bond market activity was spread over eight government stocks and four corporate securities.
The best performer in the corporate debt issues was the seven per cent Gap Developments 2011-2013 which gained 100 ticks as €5,300 nominal were transacted over a single deal to close the session at €93.00. Another gainer during the session, albeit by just a single tick, was the six per cent Gasan Finance Company 2014-2016 as investors swapped an aggregate €5,000 nominal over two deals to terminate the day at €101.00.
The day resulted in a negative outcome for bonds of the two largest local banks. The 5.35 per cent Bank of Valletta 2019 registered a decline of 98 ticks as two investors swapped €4,000 nominal to close at €102.01. Similarly, the 4.6 per cent HSBC Bank Malta closed lower by a negligible one tick as €13,000 nominal were exchanged over one deal to terminate the session at €99.99. Here bids of €3,000 nominal at €99.75 and offers of €19,125 nominal at €99.99 were the best unsatisfied positions at the close of trading.
In the government securities the session's laggard was the 5% MGS 2021(I) which lost 78 ticks on low volume of just €1,000 nominal to close at €101.82. On the contrary, the 6.10% MGS 2015 registered an increase of 0.20 per cent as €4,659 nominal was swapped over a single deal for a market consideration of €5,134.68.
The highest turnover in the government stocks was registered in the 7.8% MGS 2012(III) when a single deal was struck for a volume of €16,306 nominal as the stock ended the session at €113.57.
Weekly UK economic review
The economic data emanating from the United Kingdom during the week was dominated by the Bank of England's decision to maintain its present asset buying scheme unchanged. Moreover, the week contained important data regarding the growing unemployment levels in the country and the lower consumer price inflation.
The Bank of England has not halted its quantitative easing programme but it surprised markets last week by not announcing any extension to its £125 billion asset-buying scheme. The central bank also scaled down the pace at which it pumps money into the economy via purchases of gilts. Meanwhile, the growing number of people out of work has hit the headlines as Britain's jobless rate increased to a 12-year high in May after a record rise in unemployment over the previous three months. The Office for National Statistics said that the ILO unemployment rose by 281,000 in the three months to May, the biggest quarterly increase since records began in 1971.
This takes the jobless rate to 7.6 per cent, which is the highest recorded amount since January 1997. Furthermore, policymakers are warning that even as conditions in the wider economy start to stabilise unemployment is set to keep rising.
British consumer price inflation fell below the Bank of England's target for the first time in almost two years in June at 1.8 per cent from its previous annual rate of 2.2 per cent in May. Moreover, the broader measure of retail price inflation, which includes housing costs, fell an annual 1.6 per cent, its sharpest drop since records began in 1948.
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.