Daily Market Highlights (08.06.2017)

  • The MSE Share Index posted a three-day positive steak as it gained a further 0.53% to a one-month high of 4,676.729 points, mainly reflecting the 2.5% increase in the share price of HSBC Bank Malta plc which reached a near seven-week high of €2.09. Trading activity in HSBC was particularly healthy as a total of 107,000 shares changed hands – representing 60% of the value of equities traded today. Download a copy of today’s Equity Market Summary.
  • On the bond market, the RF MGS Index edged lower for the first time in the last four days as it slumped by 0.21% to 1,125.098 points. Euro zone sovereign yields were higher today compared to last Tuesday ahead of the European Central Bank’s (ECB) monetary policy meeting concluded this afternoon. The ECB kept its interest rates and bond-buying programme unchanged, and also maintained its pledge to adopt accommodative monetary policy at least “until the end of December 2017, or beyond, if necessary”. ECB President Mario Draghi pointed out that the Governing Council did not discuss the possibility of tapering the asset purchase programme. On the other hand, the ECB indicated that interest rates have now reached a floor as it changed the expectation of future interest rates to remain “at present levels” for an extended period of time, compared to its previous wording of “at present or lower levels”. In addition, the ECB toned down its overall assessment of risks to the euro zone economy. While there are still “downside risks” (primarily due to global factors), the ECB is now considering the risks to growth outlook are “broadly balanced.” Accordingly, the ECB raised its 2017 GDP growth forecasts for the single currency economy to +1.9% from the earlier forecast of +1.8%. Likewise, the GDP growth projections for 2018 and 2019 were also raised by 0.1% to +1.8% and +1.7% respectively. Conversely, the ECB cut its estimate for consumer price inflation for 2017 to +1.5% from +1.7%. Similarly, the ECB reduced its projected inflation rate for 2018 and 2019 to +1.3% and +1.6% respectively from an earlier estimate of +1.6% and +1.7% mainly due to energy prices.
  • The other positive performing equities today were Malta Properties Company plc and Mapfre Middlesea plc which added 5.4% and 1.5% to €0.529 and €1.98 respectively albeit on shallow volumes.
  • A single deal of just 4,700 shares pulled Malita Investments plc 2% lower to the €0.74 level.
  • Meanwhile, four of the largest companies by market capitalisation – BOV, IHI, MIA, and RS2 – all maintained their previous closing prices. Bank of Valletta plc held on to the €2.18 level across 25,930 shares.
  • Malta International Airport plc traded flat at the €4.149 level on five deals totalling 18,122 shares. This afternoon, MIA published its May 2017 traffic results revealing a 14.4% year-on-year increase in passenger movements to a record (for the month of May) of 548,354 passengers. MIA explained that the growth experienced last month translates into 68,000 additional travellers welcomed which is equivalent to an extra 12 commercial aircraft carrying a full load of 180 passengers every day.
  • International Hotel Investments plc and RS2 Software plc retained the €0.62 and €1.55 levels respectively on insignificant volumes. IHI’s Annual General Meeting is scheduled for 13 June whilst that of RS2 will be held on 20 June.
  • MaltaPost plc and Simonds Farsons Cisk plc remained close to their respective all-time highs. The postal operator retained the €2.05 level whilst Farsons also finished the day unchanged at the €7.55 level. Trading activity in both equities was low.