WEEKLY ROUND UP – 22nd -29th November 2004

Stock Exchange – Weekly Round Up   Closing  22nd November 2004 to 29th November 2004       The Central Bank of Malta left interest rates unchanged at 3% following  its November meeting After a generally difficult week, the Malta Stock Exchange Index fell 0.5%. Middlesea Insurance was the biggest gainer of the week climbing 6.67%. HSBC Bank Malta and Maltacom shares lost ground this week falling 0.7% and 2.3% respectively. Malta International Airport approached recent highs closing the week at Lm1.10, 2.8% higher Maltacom announced an interim net dividend of 1c6.     The Malta Stock Exchange Index fell 0.5% this week after negative performances in HSBC Bank Malta, Maltacom Plc and International Hotels Investments. Good results were posted by Middlesea Insurance and Malta International Airport which returned 6.67% and 2.80% respectively. This week there were just 2 gainers on the exchange compared to 6 losers and 5 equities that remained unchanged.   Trading in Bank of Valletta shares remained well supported with 19,653 shares changing hands over the week. Changes during the daily sessions remained very small. The share closed Monday’s trading sessions at Lm4.35c unchanged from the previous week.   Shares of HSBC Bank Malta shed 5c over the week losing 0.7%. 30,586 shares changed hands over 17 deals.  Maltacom plc lost 4c over the week closing Monday’s sessions at Lm1.49c. Volumes remains sustained with 78,011 shares changing hands. During the week Maltacom Plc announced that they shall be paying a dividend of 1c6 to all shareholders that are registered by Friday 3rd December. The interim dividend shall be paid to shareholders on the 20th December 2004.   On the positive side, Malta International Airport bounced back from recent lows to close the week at lm1.10c almost 3% higher. 7 deals were struck which saw a modest 4,200 shares being traded. The company is to announce its financial statements and dividend policy on Thursday 9th December. Importantly, during the 2005 Budget speech it was announced that the Government intends to sell off 20% of its shareholding via a public offer. Timelines have not been revealed.         Middlesea Insurance plc was the biggest gainer of the week racing to a 6.67% gain. 7 deals were struck which saw 7,410 shares changing hands. The share price closed the period under review at Lm2.40c. Over the year, the share price which has been predominantly in negative territory has now managed to turn around regaining all of the yearly losses.   The Central Bank of Malta left the central intervention rate unchanged at 3%. The Governor first recalled that the Bank’s primary objective in conducting monetary policy was price stability, which is widely acknowledged to be a key foundation for securing sustained improvements in economic performance and living standards in the long term. The Bank seeks to achieve this objective by pegging the Maltese lira to a basket of currencies of low-inflation countries. Referring to the interest rate decision, the Governor noted that, at their current level, official interest rates provided adequate support to the exchange rate peg. He explained that the drop in the Bank’s external reserves in October and November reflected the usual seasonal pattern, which was exacerbated by a number of other factors, including payments related to oil imports and adjustments to the liberalisation of trade and capital flows earlier in the year.   Domestic money market interest rates remained unchanged, which contributed to the stability of the premium on the Maltese lira, while investors’ response to the latest issue of long-term Government debt securities was positive. Turning to the performance of the domestic economy, the Governor observed that, as shown by the latest GDP figures, output growth continued to be weak, driven by moderate expansion in domestic demand. At the same time, inflation decreased slightly and there were some positive signs from the labour market, with the trend decline in employment being halted and partly reversed. The Governor welcomed the further fiscal consolidation envisaged in the Budget for 2005, as well as the measures that aim to increase flexibility and improve productivity across the economy. However, he stressed that a greater emphasis must be placed on permanent cuts in general government expenditure as part of the deficit reduction exercise.         Yesterday’s Trading   The Malta Stock Exchange Index gained 0.2% on Tuesday after gains in HSBC Bank Malta which closed the session up 0.7%. 10,475 shares were traded over 13 deals. Bank Of Valletta remained almost unchanged over the session losing just 0.1c to close the session at Lm4.349c.  Lombard bank was on the gainers board on Tuesday after one solitary deal edged up the share price to Lm4.011c from Lm4. Malta International Airport and Middlesea Insurance shed some gains over the session but volumes were low. Profit taking by investors has caused has slight re-tracement in these equities.       This report was issued by the Research Unit of Jesmond Mizzi Financial Services Limited. For further information please call at our offices on 21224410 or email [email protected].  This article does not intend to give investment advice and the contents therein should not be construed as such. Readers are encouraged to seek professional advice regarding their personal financial situation. The value of investments can go down as well as up.  Past performance is no guarantee for future performance. Jesmond Mizzi Financial Services Limited is licensed to conduct investment services by the Malta Financial Services Authority.