MSE equity market in negative territory for third time in a week

MSE Share Index down 0.2% to 3,155.918 points as HSBC and Lombard closed lower. On the other hand, the other four active equities, including BOV & IHI, maintained their previous price levels.

European benchmark yields dropped below the level of 2.20% for the first time in many months on speculation that the eurozone debt crisis could also impact France’s ‘AAA’ credit rating and amid increased nervousness across global equity markets.

In line with the drop in yields, the Central Bank of Malta Stockbroker sharply raised its bid prices for Malta Government Stock resulting in a 0.4% rise in the Rizzo Farrugia MGS Index to a new 7-month high of 991.856 points.

Volumes increased in the secondary market with €1.50 million (nominal) trading in the 5.25% MGS 2030 (I).

However this 19-year stock again failed to reach the Central Bank’s bid price which today stood at 103.37%. High volumes of over €1.4 million (nominal) also registered in the 4.25% MGS 2017 (III) as the stock touched a new all-time high of 104.10%.

HSBC reversed some of yesterday’s 2.2% rise as its share price retreated by 0.7% to the €2.76 level across four trades totalling just over 5,800 shares. Best bids now placed at €2.751 whilst lowest offers still pitched at the €2.80 level. The Bank is due to pay the recently declared interim dividend on 24 August.

Meanwhile BOV held on to yesterday’s 6.1% rise as the equity closed at the €2.60 level after easing from an intra-day high of €2.62. Twelve trades amounting to over 14,000 shares transacted this morning with best bids in the market at €2.58 whilst lowest offers pitched at the €2.605 level.

Also in the banking sector, Lombard Bank eased minimally lower to close at the €2.699 level across volumes of 10,500 shares. Other offers unsatisfied at the closing price whilst best bids placed at the €2.60 level ahead of the Bank’s 2011 half-year results publication on 23 August.

IHI unchanged at the €0.75 level across six trades totalling just over 11,600 shares. Similarly, MIA traded unchanged at the €1.50 level on low volumes of 1,900 shares.

A single trade of 18,150 RS2 Software plc shares was transacted at the 2011 high of €0.55. Lowest offers now placed at the €0.56 level whilst best bids still in the market at the €0.53 level.

This morning, Medserv announced that it will publish its half-year results on 30 August. These will be preceded by those of MIDI plc on 29 August with another six companies also due to report on their financial position by end-August. (SOURCE: Rizzo Farrugia (Stockbroker) Limited)

European stocks tumble

European stock markets tumbled again today with banks under renewed pressure on growing concern that the eurozone debt crisis is far from over, dealers said.

In early afternoon deals, the Paris stock market plunged 3.20 percent, London lost 0.77 percent and Frankfurt shed 1.58 percent, as Europe's main markets gave up earlier gains.

Milan stocks slumped 2.66 percent and Madrid 1.67 percent as investors remained on edge over the eurozone debt crisis which threatens to snare both Spain and Italy after Greece, Ireland and Portugal.

European equities had earlier rallied in morning deals, after sliding the previous day on rumours of a France credit rating downgrade and worries over the Greek debt exposure of French bank Societe Generale.

However, in afternoon trade, Societe Generale slumped 8.27 percent, having earlier soared by almost nine percent as the French banking giant denied it was in trouble over its Greek exposure.

At one stage yesterday, Societe Generale had seen its share price collapse by more than 20 percent.

In early foreign exchange deals, the dollar sank as low as 76.31 yen as investors flocked to the relative safety of the Japanese currency. That was not far from its post-World War II low of 76.25 yen.

The dollar later stood at 76.56 yen, down from 76.90 yen in New York on Wednesday. The euro dipped to US$1.4149 from US$1.4178.

Gold prices pulled back to US$1,791.18 per ounce, after hitting a fresh record high of US$1,814.95 overnight as investors sought the safe-haven precious metal.

Asian stock markets mostly fell today but closed off their early lows as some traders went bargain-hunting despite Wednesday's huge falls in Europe and on Wall Street.

New York's Dow Jones Industrial Average plummeted over four percent Wednesday, more than wiping out a rebound on Tuesday as European debt troubles and worries of a new US recession kept investors nervous.

The French government has flatly denied that it might be the next major country to lose its cherished AAA status and the ratings agencies said they did not plan to downgrade.

Financial markets have suffered dizzying losses in recent days and weeks amid mounting concern that the eurozone debt crisis and weak US economy could help push the world back into recession.

However, investors were reassured this week after the US Federal Reserve indicated that it would keep interest rates on hold near zero for at least two years.

At the same time, European Central Bank intervention appears to have calmed the debt market somewhat for the government bonds of Spain and other debt-laden peripheral eurozone nations.