Daily Market Highlights (12.12.2019)

MIA share price drops to 5-month low


The MSE Equity Price Index erased yesterday’s decline as it rebounded by 0.13% to 4,618.228 points. Only MIA traded lower today whilst BOV, MIDI and PG all ended higher and another three companies closed unchanged. Trading activity across the equity market improved to €0.2 million. Download today’s Equity Market Summary.

Malta International Airport plc extended yesterday’s drop by a further 0.7% to a new five-month low of €6.90 across 7,286 shares.

Also among the large companies, Bank of Valletta plc regained the €1.04 level (+1%) on activity totalling 25,359 shares. On Tuesday, BOV announced that further to the company announcement dated 17 June 2019 in relation to the termination of its USD correspondent bank with effect from 14 December 2019, BOV noted that its USD clearing provider has now extended its services to 31 March 2020. The bank also added that it is close to finalising arrangements with other service providers in order to ensure continuity of USD clearing services.

MIDI plc surged 3% to the €0.515 level after opening at a new 16-month low of €0.496. A total of 60,000 shares changed hands.

PG plc opened at a high of €1.84 (+2.8%) before ending this shortened week at the €1.80 level (+0.6%) across 22,881 shares. PG will be publishing its interim financial statements for the six-month period ended 31 October 2019 following a board meeting on 18 December.

Meanwhile, HSBC Bank Malta plc stayed at its 16-year low of €1.18 across 21,640 shares.

A single deal of 10,089 shares left the equity of RS2 Software plc at the €2.14 level.

Similarly, BMIT Technologies plc traded flat at €0.51 albeit on trivial volumes.

The RF MGS Index moved higher for the fourth consecutive day as it added a further 0.19% to 1,149.780 points. Sovereign euro bonds yields drifted lower after the US Federal Reserve yesterday decided to leave interest rates unchanged at a range between 1.5% and 1.75%. However, investors’ attention was more directed towards the rate-setters’ individual assessment of where interest rates are likely to be in the near term. In this respect, the vast majority of FOMC participants indicated that interest rates will remain unchanged in 2020. In addition, the Federal Reserve sounded a more optimistic view of the US economy. In its customary press release, the central bank dropped its previous reference to “uncertainties” in the outlook and noted that only a “material” change could trigger further interest rate cuts. Meanwhile, in the euro area, today the European Central Bank decided to leave its deposit rate facility at a record low of -0.5%. The central bank also reiterated that “the Governing Council expects the key ECB interest rates to remain at their present or lower levels until it has seen the inflation outlook robustly converge to a level sufficiently close to, but below, 2% … and such convergence has been consistently reflected in underlying inflation dynamics.” With respect to its bond buying programme, the ECB noted that this is expected “to run for as long as necessary … and to end shortly before it [the ECB] starts raising the key ECB interest rates.” Once again, the Governing Council also highlighted that reinvestments of principal payments from maturing securities will continue “for an extended period of time past the date when it starts raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation.”

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