Daily Market Highlights (22.11.2019)

Strong trading activity in RS2 & GO


The MSE Equity Price Index extended its recent downward trend as it slipped by a further 0.18% to a five-week low of 4,766.098 points. The declines in RS2 and BOV erased the gains in PG and BMIT whilst a further three companies closed the day unchanged. Trading activity surged to €0.57 million mainly due to the strong volumes transacted in RS2 and GO. During the past five days, the local equity index shed 1.32% – the sharpest weekly drop in five weeks. Download today’s Equity Market Summary.

RS2 Software plc slid 1.9% to the €2.10 level on heightened activity totalling 119,810 shares having a total market value of €0.25 million.

The other negative performing equity today was Bank of Valletta plc with a drop of 0.5% to the €1.09 level across 19,382 shares.

Also among the large companies, GO plc maintained the €4.22 level also on buoyant activity totalling 50,000 shares having a market value of €0.21 million.

Malta International Airport plc opened higher at the €7.25 level before retreating back to end the session unchanged at the €7.20 level across 1,785 shares.

Four deals totalling 5,914 shares left the equity of Malta Properties Company plc at the €0.68 level.

Meanwhile, BMIT Technologies plc rebounded by 1% to regain the €0.52 level across 129,500 shares. Yesterday, BMIT issued an Interim Directors’ Statement providing indications about the company’s performance since the start of 2019. BMIT explained that its performance continues to be positive reflecting the company’s drive to increase its service offerings. In fact, revenues during the first nine months of 2019 were 5.8% higher when compared to the same period last year. Furthermore, the growth in revenues of 5.8% is also superior to the projected rate of increase of 4.5% published in the Prospectus dated 7 January 2019. BMIT added that as revenue growth is expected to be sustained during the last three months of 2019, it is now expecting to achieve its 2019 objectives comfortably.

PG plc recaptured the €1.80 level (+0.6%) albeit on insignificant volumes.

Today, HSBC Bank Malta plc issued an Interim Directors’ Statement updating the market on the bank’s performance since the start of 2019. In this respect, HSBC explained that, consistent with the interim results, the bank’s profit before tax was higher than the same period in 2018 as although revenues remained under downward pressure, expected credit losses remained well within management expectations and below 2018. Furthermore, operating expenses were lower than the same period in 2018 reflecting the bank’s continuous focus on cost control. Commenting on the bank’s performance, HSBC Malta CEO Mr Andrew Beane explained that: “Our profitability is higher than the same period in 2018 reflecting continued trading momentum in our retail business and strong cost and credit discipline. However, the operating environment has deteriorated since our last update with further reductions in interest rates which are now expected to remain low for the long term. At the same time we have observed acceleration in customer preference for digital banking solutions. Accordingly, and as announced in October, HSBC is taking decisive strategic action to position the bank to benefit from the changing customer usage of banks and to reduce the impact of negative interest rates on the bank’s profitability. I believe these are the right strategic choices to ensure the bank’s longer term success.”

The RF MGS Index extended yesterday’s decline as it slipped by a further 0.2% to 1,148.792 points. The drop in Malta Government Stock prices took place amid encouraging signs of a rebound in manufacturing activity in Germany, France and the entire eurozone economy. Moreover, although activity across the services sector dropped by more than expected, investors’ attention was more directed towards manufacturing as this is considered to be relatively more important for the recovery of the single currency economy going forward.

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