Daily Market Highlights (15.07.11)

  • Local equity market in negative territory for the first time in four sessions as the equities of the two large banks retreat. MSE Share Index down 0.9% today to a new 20-month low of 3,290.354 points following the drops in both HSBC and BOV. Meanwhile the two other active equities, namely RS2 Software and GO closed unchanged. Download a copy of today’s Equity Market Summary.
  • This morning, the Rizzo Farrugia MGS Index edged 0.1% higher to 980.283 points in line with the marginal decline in Eurozone yields to the 2.70% level. Over the last five sessions the local MGS benchmark edged 0.7% higher mainly due to the sharp rise in local Government paper earlier this week as a short-lived panic hit European markets.
  • Fresh selling pressure forced HSBC’s share price 2.1% lower to a new 4-month low of €2.87 ahead of the Bank’s 2011 half-year results publication on Friday 29 July. Fifteen trades totalling 20,900 shares transacted today with further bids unsatisfied at the closing price whilst lowest offers still pitched at the €2.95 level. Following today’s downturn, HSBC’s equity ranks as this week’s worst performing equity with a decline of 1.7%.
  • BOV also in negative territory with its share price forced 1.4% lower back to the €2.66 level on volumes of 6,360 shares. Few other offers unsatisfied at the last traded price whilst best bids placed at the €2.63 level. Markets now await the publication of the EU-wide Bank stress test results. Nonetheless, earlier this week, Finance Minister Tonio Fenech already revealed that BOV has comfortably passed the test and ranks amongst the best capitalised banks. Equity ended the week 1.5% lower.
  • RS2 Software again unchanged at €0.53 as a further 17,000 shares changed hands at this level. A total of 206,200 shares exchanged this week with a total value of €109,286 representing around 31% of this week’s local equity trading activity.  In its last communication to the market in May 2011, the Company revealed that the new contracts concluded in the first quarter of 2011 with new clients already met the targets set by the Company for the whole year. RS2 Software now services clients from 28 countries which in turn serve banks and institutions in all regions of the world. In his address at the Annual General Meeting the CEO designate Mr Radi El Haj explained that RS2 will focus heavily on the Chinese and the US markets in the coming years. Mr El Haj stated that RS2’s payment solution system called BANKWORKS has significant potential in the American market notwithstanding the market’s maturity level and fierce competition.
  • GO held on to the €1.36 level across four trades amounting to over 4,500 shares. Offers already placed lower at €1.358 whilst best bids pitched at the €1.325 level. Equity closed the week 1.5% lower as the risk inherent in the Group’s investment in Forthnet is still weighing on investor sentiment. In fact, investors have until now shunned the Group’s complete takeover of the Bell Med Group which last year contributed positively to the already strong results from local operations.