Daily Market Highlights (07.03.11)

  • Local equity index back into negative territory on further declines in BOV and HSBC. MSE Share Index down by 0.5% to 3,554.728 points as declines in the equities of the two large banks offset the increases in the share prices of MIA and Middlesea. Meanwhile GO closes unchanged. Download a copy of today’s Equity Market Summary.
  • The Rizzo Farrugia MGS Index recovered some of last week’s 0.7% drop as the local MGS benchmark recouped 0.2% to 977.166 points following this morning’s decline in Eurozone yields to below the 3.3% level. Last Friday the benchmark Eurozone yields climbed to 3.32% following comments by the President of the European Central Bank that an interest rate hike is possible in April due to increasing inflationary concerns.
  • HSBC wipes out last Friday’s 0.3% rise as the Bank’s share price slipped 0.7% back to the €2.94 level – just €0.009 above its 2011 low. Over 11,750 shares change hands today with best bids in the market at €2.92 whilst lowest offers placed at €2.949. The final gross dividend of €0.077 per share will be paid on 21 April following approval by the shareholders at the upcoming Annual General Meeting to be held on 7 April.
  • Downturn in BOV’s share price now extends to its third successive session. BOV’s equity has dropped by 4% since its long-term credit rating downgrade to ‘BBB+’ by Fitch last week. Share price down a further 1.7% today to close at a new 4-month low of €2.85 on volumes of 25,950 shares. Last week, Fitch downgraded the Bank’s rating from ‘A-‘ to ‘BBB+’ due to the concentration risk embedded in the Bank’s loan portfolio. The international credit rating agency also noted that loan impairment charges are expected to remain higher than in the past, weighing down the Bank’s operating profit. Nonetheless, the rating agency stated that BOV still boasts satisfactory profitability, sound liquidity and funding position, adequate capitalisation. Further details available here.
  • On the other hand, MIA share price up 0.9% to the €1.75 level following yet another double-digit growth in passenger numbers. This morning the airport operator announced that during February 2011 passenger movements grew by 17.8% to 174,877 including 5,500 passenger movements generated from the Libyan-related evacuation flights during the final week of February. Further details available here. Only three trades totalling 1,000 shares transacted this morning with other offers remaining unsatisfied at the closing price. MIA is scheduled to publish its 2010 full-year results on 17 March.
  • GO recovers from a new 16-month low of €1.75 to close unchanged at the €1.77 level. 7,140 shares trade today with lowest offers still pitched at the €1.78 level. The quad-play telecoms operator and its Greek associate company, Forthnet, still have to announce their respective dates for the publication of the 2010 full-year results.
  • Middlesea Insurance edges minimally higher to close at €1.003 on volumes of 5,241 shares. The insurance company is expected to publish its 2010 financial report on 14 March.
  • Plaza Centres and FIMBank inactive today despite both trading with the entitlement to the final dividend announced late last week. Plaza Centres reported a net profit of €832,700 in line with the previous year’s profitability but recommended a lower final net dividend of €0.075 per share (2009: €0.084) as the payout ratio was reduced from 95% in 2009 to 85% in 2010.Further details available here. The trade finance specialist revealed a significant improvement in profitability from US$2.6 million in 2009 to US$6.7 million in 2010 as the Group cautiously renewed its appetite for business during the year helped by the improvement in emerging market conditions and a steady pick-up in trade flows. The Directors recommended a final net dividend of US$0.0248 per share (2009: US$0.0156) to all shareholders as at closing of trading 25 March which can be taken either in cash or in new shares. Further details available here. In the results announcement, the Group also revealed a group restructuring exercise through the creation of a new holding company. Further details on restructuring available here.

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