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Market Round-up

Market Round-up

Most stock markets around the world fell yesterday, as persistent worries over the instability in Ukraine pushed investors to take profits with major indexes still near record levels.

In New York, financial shares fell following disappointing results from American International Group, while tech shares also ended lower spearheaded by the selloff at Twitter Inc.

Investors kept an eye on the unrest in Ukraine, where more than 30 pro-Russian separatists were killed in fighting near the east Ukraine rebel stronghold of Slaviansk. Russia announced plans to beef up its Black Sea warship fleet as the two countries seem heading for war.

Financial shares lost 1.4 percent as a group, the most among 10 S&P 500 groups. AIG tumbled 4.1 percent to $50.54. First-quarter net income dropped to $1.61 billion, or $1.09 a share, from $2.21 billion, or $1.49, a year earlier, the insurer said after the close of trading yesterday.

Discovery fell 3.9 percent to $74.71. The owner of educational television channels reported first-quarter revenue of $1.41 billion, missing the average analyst estimate of $1.43 billion in a Bloomberg survey.

European stocks also closed lower yesterday, as continued violence in Ukraine and mixed earnings results made investors uneasy.

The U.K. FTSE 100, German’s DAX and French CAC closed lower.

The FTSE took a step back from a nine-week high after weak results from companies including Aberdeen Asset Management and Barclays.

Barclays reported a 5 percent fall in first-quarter adjusted pre-tax profit to £1.7 billion, as the fixed-income division of its investment bank slowed significantly consequently the share price closed 5 percent lower. Investment manager Aberdeen Asset Management closed around 2.6 percent lower, after results showed clients pulled money out of its core emerging market and Asian equity funds.

In Germany, better-than-expected earnings from Lufthansa and Continental helped offset fears over the Ukraine conflict.

M&A news

German drug maker Bayer, yesterday announced its plans to acquire the consumer care business of Merck & Co for $14.2 billion in cash. Shares in Bayer closed down around 0.9 percent after the news.

Meanwhile, AstraZeneca, the U.K. pharmaceutical company fighting off approaches from larger U.S. rival Pfizer, bolstered its defense by announcing the earlier-than-expected approval of a new drug.

ECB

The European Central Bank is expected to reiterate its concern about the impact of having a strong euro whilst having low inflation when it meets tomorrow. Economists doubt the ECB will cut record-low interest rates again.

Portugal’s plan to exit its bailout encouraged investors and increased optimism that the ECB could loosen monetary policy.

Asian stocks were mixed on yesterday with markets in South Korea, Hong Kong and Japan shut for holidays.

Local

The MSE Share Index fell slightly as the declines in HSBC, BOV and GO outweighed the increases in MaltaPost, GlobalCapital Rs2 and MIA.

BOV share price fell 0.5% to €2.23 as the equity turned ex-dividend. An interim dividend of €0.0276 will be paid on 23rd May.

HSBC followed suit ending the session lower at €2.14.

GO shares fell 1% to €1.979. At the company’s Annual General Meeting held yesterday the shareholders approved a net dividend of €0.07 per share which will be paid on 9th May.

RS2 Software closed 0.4% higher at €2.43.

MIA share price ended the session at €2.27, 0.4% higher.

GlobalCapital saw an increase of 25.2% to €0.75.

MaltaPost leaped 7.7% reaching the price €1.12.

The Calamatta Cuschieri Traders Blog is available daily on CC WebTrader. Other market coverage including coverage of the International Bond Markets is also available.

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