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Session characterised by sluggish activity

GlobalCapital 10 September 2009 13:21

During trading, the local market witnessed a dull session. Activity was poor as only two stocks were negotiated in the equity market. Bank of Valletta p.l.c. was the sole gainer of the day while the shares of HSBC Bank Malta p.l.c. traded sideways without affecting their previous closing price. The Malta Stock Exchange gained 0.07% to finish at 3023.15 points.

· Large cap Bank of Valletta p.l.c. had a rather slow session. A total of 2,666 shares dealt over four deals, caused the price to increase by €1c1 to read €2.96. At the end of trading, bids for 849 shares stood at €2.96, whereas the best offer for 5,244 shares stood at €2.99.

· Remaining on the banking front, HSBC Bank Malta p.l.c. maintained its previous session price at €2.66 after 4,060 shares worth €10,804 were swapped in five transactions. The price shifted in a very tight range of €2.66 to €2.662.

· On the International front, a Connecticut court ordered UBS to pledge assets or post a $35 million bond after finding "probable cause" that the bank committed securities fraud in a deal with Pursuit Partners, the hedge fund's lawyers said on Wednesday. Superior Court Judge John Blawie found probable cause that UBS used secret insider information obtained from its relationship with ratings agencies Moody's and Standard & Poor's to commit securities fraud in the sale of collateralized debt obligation notes to Pursuit.

· Furthermore, the Bank of England announced an unchanged base rate at 0.50%.

U.K. - Market News & Gossip

· There were no major surprises with the official announcement from the FTSE Review Committee yesterday evening, and Burberry already comes into the FTSE100 today after Thomson Reuters removed its London listing.

· Despite Kraft attempting to play down the talk UK business press again suggests that it is looking to make a higher bid for Cadbury with a higher cash element.

· Redstone announces that it has received an early stage approach.

· As expected OPEC left official output rates unchanged yesterday.

· Galliford Try announces a fully underwritten rights issue to raise around £125m which it would use to reinvest in land and significantly expand its housebuilding business.

E.U. - Market News & Gossip

· Huawei responds to talk and states that it is not in alliance talks with Alcatel-Lucent.

· Popular announces that it is to launch a new share and convertible bond issue to raise around €1bn to help shore up its capital base.

· Spanish press writes that EDF is finalising its entry to the Spanish gas distribution market, and speculation is that the current chief of Veolia could be the next head of the French state owned power group.

· While Spanish food group Natra stated late yesterday that talks with Barry Callebaut to merger their chocolate businesses had ended.

· The now mammoth story of the USAF refuelling contract starts a new chapter as the Pentagon is seen putting the finishing touches on the draft rules for the new bidding process.

· The CFO of BMW states that it aims to strengthen ties with Peugeot.

· Van der Moolen filed for bankruptcy yesterday as it could no longer meet its expenses and as it failed to find a buyer.

· Arcandor’s creditor banks are to sell its full 43.9% stake in Thomas Cook and reports suggests that placing is already well covered.

· Ferrovial states that Heathrow recorded its busiest ever Heathrow, although BAA traffic overall fell 3.1% and keeps its challenging outlook.

U.S. - Market News & Gossip

· The WSJ writes on how the banking industry is to face its first test as the Federal Deposit Insurance Corp is preparing to wind down the emergency program its launched last year.

· GM is expected to hold a news conference at around 14:00 today where it is expected to state that it now intends to hang into its Opel unit, which will cause political pressure as Chancellor Merkel has thrown the governments weight behind the Magna bid.

· Time Warner responds to the Marvel move by Disney by renaming its DC Comics unit DC

Entertainment and moving the unit into its studio.

· The ECB’s Tumpel-Gugerell states that the economy has stabilised but that it would be shortsighted to return to a business as usual format, and that sufficient credit supply to businesses was still the main focus.

· Blackstone responds to talk and states that they are in talks with Japan’s Suntory regarding the future ownership of the Orangina Schweppes Group.

· In UK trading the board of Jarvis responds to its share price move, up 4% today, and confirms that an extremely preliminary tentative inquiry has been made over a possible offer.

Alan-Charles Bishop

Source: Man Financial Ltd.

Date: 10/09/2009

Issued by GlobalCapital Financial Management Ltd, 120 The Strand, Gzira, GZR03 for information purposes only and is not intended to constitute any financial, legal or tax advice. This write up is not to be taken as investment advice to buy or sell any investment. Investors should seek professional advice prior to taking investment decisions and should note that the value of investments may fall as well as rise. Readers who would like more information are invited to send an E-mail to info@globalcapital.com.mt or Tel: 21 310088. GlobalCapital Financial Management Ltd, is a member of the Malta Stock Exchange and is licensed by the Malta Financial Services Authority (MFSA).

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