Daily Market Highlights (08.08.2011)

  • The MSE Share Index closed in negative territory for the third consecutive session on a minimal decline in BOV’s equity. Meanwhile Lombard Bank closed unchanged thereby maintaining last week’s gains. Negligible activity in the local equity market as investors digest the international news headlines and continue to focus on Malta Government Stocks. Download a copy of today’s Equity Market Summary.
  • The European Central Bank stepped into bond markets this morning, backing up a pledge to support Spain and Italy with the aim of averting a financial meltdown in the Eurozone, while the Group of Seven nations offered soothing words to investors shaken by a historic downgrade of the US debt rating. Last week, the ratings agency Standard & Poor’s downgraded its rating for US sovereign debt to AA+. The Group of Seven nations issued a statement this morning saying that it will take “all necessary measures to support financial stability and growth.” Prices of eurozone government bonds declined this morning following the ECB intervention with the yield on 10-year German government bonds rising at the highest pace in almost 15 months. Following this development, the Central Bank of Malta Stockbroker revised its Malta Government Stock bid prices lower forcing the Rizzo Farrugia MGS Index to move 0.4% lower to 983.337 points.
  • Following the decline in bid prices, further large trades were executed in two of the Malta Government Stocks. €1 million (nominal) worth of the 5.7% MGS 2012 (III) and a further €1 million (nominal) worth of the 7.8% MGS 2012 traded this morning with both edging lower to close at 104.39% and 104.72% respectively. Meanwhile, the 19-year paper fell 92 basis point to 102.05% after the Central Bank of Malta lowered its initial bid price for the stock from last Friday’s 103.44% to 102.05% today.
  • On the equity market, BOV edged 0.04% lower to €2.689 on activity of 3,140 shares.
  • Lombard Bank’s share price traded unchanged at the €2.69 level as 22,000 shares were exchanged across two trades. The Bank is scheduled to publish its half-year results on 23 August.
  • Last Friday Middlesea Insurance plc published its 2011 interim results. Middlesea explained that during the first half of 2011 the Group registered a profit before tax of €1.6 million compared to €3.4 million registered in the comparable period last year. The insurance company stated that this variance in profit is the result of an improvement in the pure technical insurance operations which however did not compensate for the adverse share of profit from the associated undertaking MSV Life plc. Further details available here. Also last Friday, Middlesea announced that it was informed by Mapfre International S.A. that it will proceed to issue a Mandatory Bid to the shareholders of Middlesea following the acquisition of a controlling interest in the company, in terms of Chapter 11 of the Listing Rules. Further details available here.
  • Following the publication of the interim results by Middlesea last week, investors now await the half-year results of another 10 companies having a December financial year –end, including FIMBank, IHI, GO and RS2 Software.