Issue link: https://maltatoday.uberflip.com/i/449474
maltatoday, WEDNESDAY, 21 JANUARY 2015 12 Business Today Money Market Report for the week ending January 16, 2015 ECB Monetary Operations On Monday, January 12, the European Central Bank (ECB) announced its weekly main refinancing operation (MRO). The auction was conducted on Tuesday, January 13, and attracted bids from euro area eligible counterparties of €113.99 billion, €1.65 billion higher than the bid amount of the previous week. The amount was allotted in full at a fixed rate equivalent to the prevailing MRO rate of 0.05%, in accordance with current ECB policy. On Wednesday, January 14, the ECB conducted a seven-day US dollar funding operation through collateralised lending in conjunction with the US Federal Reserve. This operation was carried out at a fixed rate of 0.62% and did not attract bids from euro area eligible counterparties. Domestic Treasury Bill Market In the domestic primary market for Treasury bills, the Treasury invited tenders for 91-day and 182- day bills maturing on April 17, and July 17, 2015, respectively. Bids of €59.00 million were submitted for the 91-day bills, with the Treasury accepting €8.00 million, while bids of €47.00 million were submitted for the 182-day bills, with the Treasury accepting €20.00 million. Since no bills matured during the week, the outstanding balance of Treasury bills increased by €28.00 million, to stand at €185.44 million. The yield from the 91-day bill auction was 0.025%, i.e. 1.0 basis point lower than on bills with a similar tenor issued on January 9, 2015, representing a bid price of 99.9937 per 100 nominal. The yield from the 182-day bill auction was 0.055%, i.e. 0.3 basis point higher than on bills with a similar tenor issued on January 2, 2015, representing a bid price of 99.9722 per 100 nominal. During the week under review, there was no trading on the Malta Stock Exchange. On Tuesday the Treasury invited tenders for 28-day and 91-day bills maturing on February 20, and April 24, 2015, respectively. Regular market closed – 20/01/2014 Symbol Code Volume Traded Value Traded Trades High Price Low Price Open Price Close Price Change Twap t BOV 52926 110822.240 22 2.100 2.090 2.100 2.090 -0.010 2.094 l GO 7100 18383.700 6 2.595 2.585 2.595 2.595 0.000 2.589 s LOM 2000 3616.970 2 1.810 1.800 1.800 1.810 0.010 1.808 l MIA 40280 97457.100 7 2.420 2.410 2.420 2.420 0.000 2.419 s MTP 5700 6908.400 1 1.212 1.212 1.212 1.212 0.002 1.212 t G15A 11647 11913.720 1 102.290 102.290 102.290 102.290 -0.020 102.290 t G15B 11880 12369.460 1 104.120 104.120 104.120 104.120 -0.010 104.120 l G15F 5000 5156.500 1 103.130 103.130 103.130 103.130 0.000 103.130 s G16A 23998 25819.460 5 107.590 107.590 107.590 107.590 0.010 107.590 s G16B 9786 10588.450 3 108.200 108.200 108.200 108.200 0.030 108.200 t G17C 28000 30951.200 2 110.540 110.540 110.540 110.540 -0.020 110.540 s G18A 4659 5826.080 1 125.050 125.050 125.050 125.050 0.070 125.050 l G19A 4659 5897.830 1 126.590 126.590 126.590 126.590 0.000 126.590 l G20A 11648 14228.030 2 122.150 122.150 122.150 122.150 0.000 122.150 s G21A 129016 160224.970 6 124.190 124.190 124.190 124.190 0.020 124.190 s G22A 10716 13622.180 3 127.120 127.120 127.120 127.120 0.040 127.120 s G22B 9000 10884.600 2 120.940 120.940 120.940 120.940 0.050 120.940 s G23A 41000 54189.700 2 132.170 132.170 132.170 132.170 0.300 132.170 s G28A 38000 49301.200 2 129.740 129.740 129.740 129.740 0.150 129.740 s G28B 446000 562584.400 10 126.140 126.140 126.140 126.140 0.140 126.140 s G29A 32500 43231.500 3 133.020 133.020 133.020 133.020 0.130 133.020 s G30A 313800 421743.200 16 134.400 134.000 134.000 134.400 0.120 134.400 s G31A 95000 126055.500 7 132.690 132.690 132.690 132.690 0.110 132.690 s G32A 207500 257537.500 17 124.180 123.330 123.330 124.180 0.100 124.110 s G32B 151700 183936.250 12 121.250 121.250 121.250 121.250 0.100 121.250 s G33A 252000 298015.200 12 118.260 118.260 118.260 118.260 0.260 118.260 s G34A 399700 460854.100 13 115.300 115.300 115.300 115.300 0.050 115.300 s AX24A 8600 9349.050 2 108.800 108.550 108.550 108.800 0.300 108.710 t BV19A 3000 3211.300 2 107.100 107.000 107.100 107.000 -0.100 107.040 s BV20A 7000 7423.500 1 106.050 106.050 106.050 106.050 0.050 106.050 l HB17A 5000 5258.500 1 105.170 105.170 105.170 105.170 0.000 105.170 l HM24A 66800 68969.500 8 103.250 103.240 103.240 103.250 0.000 103.250 t IG19A 5900 6047.500 1 102.500 102.500 102.500 102.500 -0.010 102.500 l IG24A 27900 29573.680 7 106.000 105.990 105.990 106.000 0.000 106.000 s IH19A 2000 2012.000 1 100.600 100.600 100.600 100.600 0.040 100.600 s IH23A 10000 10300.000 1 103.000 103.000 103.000 103.000 0.480 103.000 s MI15A 500 475.000 1 95.000 95.000 95.000 95.000 1.750 95.000 s MI17B 14000 13999.740 3 100.000 99.990 99.990 100.000 0.010 100.000 l MO19A 600 636.360 1 106.060 106.060 106.060 106.060 0.000 106.060 l PG20A 10700 11502.500 3 107.500 107.500 107.500 107.500 0.000 107.500 s PG22A 25000 26625.000 1 106.500 106.500 106.500 106.500 0.500 106.500 s PT24A 65500 69093.650 6 105.500 105.300 105.300 105.500 0.200 105.490 s SF20A 1700 1803.870 1 106.110 106.110 106.110 106.110 0.100 106.110 s TI24A 5100 5458.530 1 107.030 107.030 107.030 107.030 0.530 107.030 s UF23A 27000 28205.200 2 104.500 104.010 104.010 104.500 0.500 104.460 Market Summary as at January 20, 2015 Equity Official List Session State ................................................................... closed Number of trades ............................................................. 203 Volume Traded ................................................................. 2,631,515 Value of € denominated securities .................................... 3,288,064.58 Value of US$ denominated securities ................................ 0.00 Value of GBP£ denominated securities .............................. 13,999.74 Current Index ................................................................... 3384.178 Previous Index ................................................................. 3387.666 Change in Index (%) ......................................................... -0.103% 6pm Holdings plc ........................... 0.700 0.00% Malta International Airport plc ........ 2.420 0.00% Bank of Valletta plc ......................... 2.090 -0.48% MaltaPost plc .................................. 1.212 0.17% Crimsonwing plc ............................ 0.850 0.00% Medserv plc ................................... 1.470 0.00% FIMBank plc ................................... 0.600 0.00% Middlesea Insurance plc ................. 1.000 0.00% GlobalCapital plc ............................ 0.800 0.00% MIDI plc ......................................... 0.210 0.00% GO plc ............................................ 2.595 0.00% Plaza Centres plc ............................ 0.685 0.00% Grand Harbour Marina plc .............. 1.820 0.00% RS2 Software plc............................. 2.970 0.00% HSBC Bank Malta plc ...................... 1.990 0.00% Simonds Farsons Cisk plc ................ 3.070 0.00% International Hotel Investments plc 0.590 0.00% Tigné Mall plc ................................. 0.616 0.00% Island Hotels Group Holdings plc .... 0.990 0.00% Pefaco International plc .................. 2.190 0.00% Lombard Bank Malta plc ................. 1.810 0.56% Malita Investments plc .................... 0.652 0.00% Santumas Shareholdings plc .......... 2.000 0.00% Market commentary: The Chinese GDP With the US market closed on Mon- day for the Martin L. King Day, the main news came from China after releasing the fourth quarter and full year GDP data. Although the sec- ond largest economy reported an economic expansion of 7.4%, very close to the Government target of 7.5%, this has officially become the weakest GDP number since 1990. GDP's growth was supported by an increase in industrial output, which rose 7.9%, and better retail sales, which rose 11.9%, however the announced shift from an economy based on "growth at all costs" to a better quality and more sustainable internal demand driven economy is starting to materialized within the GDP data. Although on an historical basis the latest GDP data seems weak, when contextualized in today economic environment, China did not performed so bad and managed to substantially reach the Government target while slightly beating analysts' forecasts. Following the news, the Shanghai and Hong Kong markets rally overnight adding 1.82% and 0.76% respectively, followed by an appreciation of the Yuan. In addition to this positive news, China has also taken a first row sit in the news for suspending all three major national brokerage firms from any additional margin and security lending, after an investigation suggested major and consistent regulatory breaches. In fact, it appears that Chinese major brokers allowed customer to over-leverage and delay margin call repayments against specific regulations implemented by the competent Authority. This unprecedented measure taken by the Chinese Authorities has caused a selloff in the sector, with the largest listed brokerage firm Citc Securities Co., losing 20% in over the last two trading sessions and Haitong Securities Co., also listed in Shanghai, losing 18%. Crude Oil took another dive losing over 2.7% with the Brent Benchmark returning below $50 per barrel on the back of GDP data from China. Markets fear that with the second largest economy adjusting to lower annual growth and US becoming less dependent from oil imports, the demand for the commodity will not be able to absorb the current oversupply for quite some time. In this context more volatility for oil related sectors is to be expected, and the recently one of rebound of energy stocks may be very short lived upon US reopening today, with investors still likely to leave money on the side awaiting a more consistent stabilization of oil and commodities prices before returning in the market as buyers. Europe posted a positive session on Monday and has opened higher this morning fuelled by the better than expected China GDP data and ahead of a major ECB meeting on Thursday, when a formal QE program is widely expected to be announced. Although the actual implementation of such a program may prove challenging and long term, analysts and most investors are betting that the news will support equities and bonds markets in the short term, making the EUR a potential good short term trade rather than a long investment. At the time of the writing, the Euro Stoxx 600 was up 0.49%, the Dax Index was gaining 0.26% and the FTSE 100 opened 0.46%, while even the Swiss SMI managed to open 1.03% higher after three consecutive days of heavy losses, and the provision of a very attractive entry point for new investors. Finally, Delta Airlines Inc. is due to report this afternoon, with the airline sector experiencing a sustained rally supported by lower fuel costs, and the Company bouncing back from last October selloff posting a stunning gain of 48% up to date, its earnings release will be closely watched by investors assessing whether the stock can keep up the momentum and provide additional upside potential. This article was issued by Paolo Zonno Trader/Analyst at Calamatta Cuschieri. For more information visit, www.cc.com.mt . The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri & Co. Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.