Daily Market Highlights (10.10.16)

  • The MSE Share Index kicked-off the week on a negative note as it dropped 1.06% to 4,437.983 points – effectively erasing all the gains registered in the previous nine trading sessions. Among the nine actively traded equities, five closed lower while the remaining four closed unchanged. Download a copy of today’s Equity Market Summary.
  • After seven consecutive daily declines, the RF MGS Index edged 0.06% higher to 1,168.134 points today. Euro zone sovereign bond yields were generally higher today (prices went down), with the 10-year benchmark German Bund yield advancing to 0.032% from 0.012% last Friday. The most notable exception were the yields of Portugese government bonds as comments from the country’s finance minister helped reduce concerns about a possible downgrade from the credit rating agency DBRS which is due to publish its rating review on Portugal on 21 October 2016. Portugal needs to maintain at least one investment grade rating from a major agency to keep its position in the European Central Bank’s (ECB) bond-buying scheme. All three other credit rating agencies recognised by the ECB classify Portugal as non-investment grade. Meanwhile, on the economic front, results of a recent survey in the euro zone showed that investor sentiment improved by more than expected in October, hitting its highest level since before the UK’s referendum on its membership within the EU. In addition, other data showed that Germany’s exports rose by 5.4% in August – the strongest monthly gain since May 2010.
  • The worst performing equity today was Malta International Airport plc which shed 4.0% (equivalent to €13.8 million in market capitalisation) to €4.10 – the lowest level in over two months. Trading activity was weak with only 4,000 shares changing hands. Last Friday, MAI published its September traffic results revealing a 5.8% increase in passenger movements to an all-time high of 531,962 passengers. Between January and September 2016, MIA registered a 7.5% increase in passenger movements to 3.89 million when compared to the same period last year on the back of a 5.3% increase in seat capacity and a 1.7 percentage point increase in the seat load factor to 83.4%. In July, MIA had revised upwards its passenger growth forecast for 2016 to +7.5% to 4.97 million passengers compared to the previous 2016 forecast of 4.73 million (+2.4%) revealed in January 2016.
  • Also among the large companies, International Hotel Investments plc lost 3.1% to the €0.615 level on higher volumes totalling 41,588 shares.
  • Similarly, HSBC Bank Malta plc retreated by 1.8% from its six-month high of €1.67 to €1.64 across 35,523 shares.
  • In the banking sector, FIMBank plc shed 1.6% to the USD0.90 level across two deals totalling 20,000 shares after briefly touching an intra-day low of USD0.88 (-3.8%).
  • Following last Friday’s announcement, Medserv plc dropped 2.5% to the €1.53 level across 15,000 shares. The oil and gas logistics provider revealed that it was unsuccessful in its bid for a contract relating to the provision of services offshore Cyprus to an IOC. Meanwhile, Medserv continues to provide shore base services to ENI from its base in Larnaca.
  • In contrast, GO plc held on to its four-month high of €3.25 across 6,153 shares.
  • Bank of Valletta plc and Malta Properties Company plc continued to trade within their recent highs. BOV closed the day unchanged at the €2.29 level on activity of 35,353 shares after recovering from a low of €2.265. BOV’s financial statements as at 30 September 2016 will be published by the end of October. Similarly, MPC maintained the €0.59 level on volumes of 73,680 shares after opening the day at €0.571.
  • RS2 Software plc maintained its four-week low of €1.57 on volumes totalling 15,492 shares.
  • Trading in Malta Government Stocks was again centred around the recently issued 2.4% MGS 2041 (I) r. In fact, €4.48 million (nominal), representing 65.4% of the total nominal value of MGS traded today, changed hands today. The stock closed at 106.51% which is 24 basis points lower than the corresponding indicative bid price of the Central Bank of Malta of 106.75%.
  • Last Friday, the Treasury announced the issue of 2 new Malta Government Stocks for a total aggregate amount of €100 million subject to an over-allotment option of up to a further €60 million. The 2 new issues are the 1.50% MGS 2022 (IV) FI and the 2.10% MGS 2039 (I). The issue prices of both securities will be determined on Thursday 13 October 2016 in the afternoon. Subscriptions open on Monday 17 October.