Daily Market Highlights (01.07.2020)

Farsons drops below the €8.00 level


The MSE Equity Price Index eased by 0.1% to 4,048.810 points as the drop in the share price of Farsons outweighed the gain in HSBC whilst BOV and MIA closed today’s trading session unchanged. Activity across local equities contracted further to just €0.06 million. Download today’s Equity Market Summary.

Simonds Farsons Cisk plc lost 3.7% to close at the €7.90 level on activity totalling 4,324 shares.

HSBC Bank Malta plc added 1.1% to regain the €0.96 level albeit on 1,074 shares.

Low trading activity also took place in the equity of Malta International Airport plc which maintained the €5.80 level. The airport operator resumed commercial operations today after a temporary ban lasting over three months was imposed by local authorities due to ‘COVID-19’.

Four deals totalling 22,886 shares left the equity of Bank of Valletta plc at the €1.00 level.

The RF MGS Index extended yesterday’s decline as it dropped by a further 0.13% to 1,098.427 points. Sovereign bond yields in the euro area edged higher on the back of encouraging economic data across the single currency block including strong manufacturing PMIs as well as retail sales in Germany.

Across the bond market, a number of other important announcements took place. Melite Finance plc, the issuer of the €9.25 million 4.85% secured bonds maturing in 2028, published its 2019 Annual Report wherein it highlighted that due to the significant negative impact of ‘COVID-19’, its the ability to continue as a going concern is dependent on the successful implementation of a restructuring plan. The latter is based on a number of measures including the acceptance by its bondholders of a reduction in the bond interest rate to 3.5% with effect from the interest payment due in November 2021. Melite Finance also needs to avail itself of the COVID-19 Guarantee Scheme offered by the Malta Development Bank and in this respect, it is in advanced discussions with its bankers for the issuance of a loan of €0.499 million for the purpose of funding the bond interest payment due to bondholders in November 2020. Melite Finance noted that it expects to convene a meeting of bondholders in due course.

Mediterranean Investments Holding plc announced that it obtained regulatory approval for the issuance of €20 million 5.5% unsecured bonds redeemable in 2023 guaranteed by Corinthia Palace Hotel Company Ltd. The proceeds from the issuance of the new bonds are being used to redeem the 5.5% unsecured bonds which are due to mature on 31 July 2020.

The Treasury announced the issue of €150 million in new Malta Government Stocks subject to an over-allotment option of an additional sum up to a maximum of €100 million. Applications in the form of sealed bids (auction) for amounts of a minimum of €500,000 nominal will open on Wednesday 8 July and close on the same day.