Equities in the US fell on Friday as official data showed that the US economy shrank in the fourth quarter of 2008 at its fastest rate since 1982 after a massive decline in inventories held by companies. The equity market was also taken aback with the news that the US government agreed to become the biggest single shareholder in Citigroup, with a stake of up to 36%. This dragged the Dow Jones Industrial Average down by 4.1% this week and 19.5% year to date.
In the UK, banking shares fell on Friday after recovering earlier in the week when it was announced the government will inject up to £25.5bn in the Royal Bank of Scotland (RBS) and insure £325bn of its assets in the asset protection scheme.
London's FTSE 100 lost 1.5% this week and 13.6% so far year. This not withstanding the fact that UK consumer confidence staged a surprise recovery in February, which could be a first indication that the government's efforts to stimulate the economy and encourage bank lending may be working.
Europe's equity markets also had a bad week with Germany's Xetra Dax falling over four per cent, and now down 21% since January. Meanwhile, France's CAC 40 fell 1.75% this week and over 16% this year.
On Friday, a group of multi-national lenders unveiled a lending package of up to €24.5bn ($31bn) to help central and eastern Europe's banks in a move to encourage the international banking groups that control most of the region's banks to support their subsidiaries.
The Malta Stock Exchange index closed on Friday at 2,818.996 points, a loss of 1.54% on the week, notwithstanding the recovery of 1.26% on Thursday and 1.055% on Friday. So far this year the MSE index has lost 12.13%.
During the week, 13 equities were negotiated, with eight closing down, four up and one stable. Plaza Centres plc was the best performer as its share price rose 1.19% to close at €1.70, while 6pm Holding plc lost most ground with its share price plumetting 15.71% to close at £0.59.
During the week, 369 deals were registered on the MSE for a turnover of over €10m. In the equity market, 259 transactions were carried out for a total of €753,663. In the corporate bond market, 58 deals for a total of €347,703 were executed, while in the government bond market, 44 transactions took place for a value of over €3m. Seven deals were carried out in the Treasury bills market for a value of over €5.8m.
Bank of Valletta plc (BoV) appreciated by 0.04 per cent this week as 105,206 shares were negotiated across 101 deals for a total of €226,430. On Monday and Tuesday the share price dropped 4.98% and 4.78% respectively to €2.033. This trend continued on Wednesday as BoV slipped a further 0.15% to €2.03, having traded at a low of €2.001 on 122 shares.
However, on Thursday it turned positive as it appreciated by 3.55% to €2.102. On Friday, the equity was the best performer of the day, appreciating 6.95% to close at €2.248.
Following last week's publication of HSBC Bank Malta plc's results for 2008, the bank's share price rose on Monday by 2.63% to €2.34. However, the price dropped 4.27% on Tuesday, and 5.67% on Wednesday.
This negative trend was reversed on Thursday when it was the most traded equity, as 10 deals for a total of 16,000 shares led to the prise rising 4.12%. On Friday, the price gained another 1.82% to €2.24. Notwithstanding this positive run in February's last two days of trading, HSBC this week lost 1.75% as 96,761 shares were negotiated across 83 deals.
HSBC shareholders as at last Friday are entitled to the net dividend of €0.062 per share that will be paid on April 20 following shareholders' approval at the annual general meeting due on April 1.
Lombard Bank Malta plc's share price crept up 0.41% during the week to close at €2.46 as four deals were executed for a total of 42,050 shares.
Fimbank plc lost ground on Monday as its share price slipped 0.67% to $1.49 as 15,048 shares were negotiated across three deals. The price remained unchanged on Friday despite 6,813 shares changing hands across four deals.
6pm Holding plc lost most ground among the traded equities as 10,000 shares were negotiated across six deals and its share price fell 15.71 per cent to close at £0.59.
Plaza Centres plc, the week's best performer, only traded three times with 11,000 shares changing hands. On Tuesday, a single deal of 3,000 shares led the price to a miniscule drop of 0.06%. However, two deals on Thursday involving 8,000 shares led to the price appreciating 1.25% to close at €1.70.
Go plc's share price tumbled 11.71% to close at €1.501 as 31,120 shares were negotiated across 21 deals. A single trade of 1,500 shares led to a 0.94% drop on Monday. Go's price lost a further 4.99% on Thursday and reached an all-time low of €1.60. On Friday, the equity which lost most ground as its share price dropped a further 6.19% to end the week at €1.501.
A single deal of just 2,000 Crimsonwing plc shares resulted in a 5.63% drop in the company's share price to €0.469.
Malta International Airport plc saw its share price increase 0.95% on Monday to €2.45 as 35,600 shares were negotiated across 20 deals.
The share price of Middlesea Insurance plc remained stable at €2.575 despite 1,000 shares being traded on Tuesday in four deals.
Simonds Farsons Cisk plc saw 0.05% shaved off its share price which closed at €1.899 as 8,000 shares were traded in six deals.
By the end of the week the price of Maltapost plc shares fell 3.92% to close at €0.759 as 1,115 shares were negotiated across two deals, including a single deal of 1,000 shares on Thursday that led to a 3.68% drop in the price.
The postal operator is expected to pay the final net dividend of €0.04 per share on Wednesday, following shareholders' approval at the company's recent annual general meeting. A Maltapost directors' statement on Friday said from October 1, 2008, to date, the company has achieved its operational performance targets set at the beginning of the financial year.
A single trade of 1,000 shares in RS2 Software plc led to a 4.94% drop in the share price, which closed at €0.75 on Friday.
This article, which was compiled by Jesmond Mizzi Financial Services Limited (JMFS), does not intend to give investment advice and the contents therein should not be construed as such. JMFS is licensed to conduct investment services by the MFSA. The directors or related parties, including the company, and their clients are likely to have an interest in securities mentioned in this article. For further information contact JMFS at 67/3, South Street, Valletta or on Tel: 2122 4410 or e-mail jmizzi@jmfs.net.