Sharp rise in Malta Government Stock prices

Following yesterday’s decision by the European Central Bank to cut interest rates by a further 25 basis points back to the historic low of 1%, the indicative Malta Government Stock bid prices quoted by the Central Bank of Malta were revised sharply higher today. The Rizzo Farrugia MGS Index increased by 0.3% to 984.217 points reflecting the higher prices across the entire maturity profile. The indicative price quoted by the Central Bank in the 5.20% MGS 2031 (I) rose by 47 basis points today to a record of 102.41%. On the secondary market, the price closed the first week of trading 175 basis points higher at 102.50%.

 The equity market continued to be characterised by low trading activity. 3 of the 5 active equities today closed higher while GO plc maintained its all-time low of €0.95 and MaltaPost plc shed 2.6% on a single trade of a mere 204 shares despite still trading with the entitlement to the net dividend of €0.04 per share.

Despite the marginal gain in the MSE Share Index today, the local benchmark still closed this shortened week 0.7% lower at 3,092.984 points following the declines in Malta International Airport plc (-6.9% to €1.565), GO plc (-5% to €0.95), FIMBank plc (-3.9% to US$0.74) and MaltaPost plc (-3.1% to €0.95).

The share prices of the two large banks closed in opposite directions this week. HSBC Bank Malta plc edged 0.2% higher to €2.585 after dropping to a new 29-month low of €2.55 last Monday. On the other hand, Bank of Valletta plc eased 0.4% lower to €2.501.

Next week, Bank of Valletta will be holdings its Annual General Meeting on Friday 16 December to approve a number of resolutions including the recommended final gross dividend of €0.08 per share and a 1 for 8 bonus share issue. Shareholders as at close of trading on 9 January 2012 will be eligible to the bonus shares. Meanwhile, on Thursday 15 December the Greek company Forthnet will be convening an Extraordinary General Meeting to approve a number of changes to the company’s capital structure and a €30 million rights issue in line with the conditions of the latest €90 million bond loan.