Activity weakens as investors focus on bonds

Trading activity on the Malta Stock Exchange weakened with low volumes across the five active equities as investors turned their attention to the new bond issues by Pendergardens Developments plc and Island Hotels Group Holdings plc. The MSE Share Index edged marginally higher to 3,412.266 points as the gains in Bank of Valletta plc and Malta International Airport plc outweighed the minimal drop in the equity of HSBC Bank Malta plc.

Bank of Valletta plc recovered some of the losses in the early part of the week as the share price edged 0.5% higher to €2.12 on lower volumes of just over 12,000 shares. The bank will be paying its interim dividend next Friday.

Meanwhile, the share price of HSBC Bank Malta plc continued to edge lower to a fresh multi-year low of €2.09 on volumes of 7,200 shares. Earlier this week, HSBC reported that its profitability during the first few months of 2014 was below that of the corresponding period last year due to interest margin compression, slow loan growth, a reduced contribution from the life insurance business, increased regulatory fees and higher loan impairments.

Malta International Airport plc edged 0.4% higher to the €2.26 level also on low volumes of 1,290 shares. Tomorrow the company will be holding its Annual General Meeting. On Monday MIA reported that its financial performance since the start of the year has been better than projected following the 10.3% growth in passenger traffic. MIA stated that the outlook for the summer season looks positive albeit at significantly reduced growth rates than those achieved in the first four months.

RS2 Software plc continued to trade at its all-time high of €2.40 with a further 4,920 shares changing hands at this level. Last week RS2 announced that during Q1 2014, the Group registered a 38% increase in revenue to €2.9 million and a significant improvement in net profit to €0.47 compared to €0.15 in the first three months of 2013.

Likewise, Malita Investments plc held on to the €0.55 level on a single trade of 10,000 shares.

On the bond market, the Rizzo Farrugia MGS Index declined for the third successive day as Eurozone yields continued to edge higher approaching the 1.4% level.