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Markets react to virus threats

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US markets saw a bad start to the week on Monday and closed lower as growing worries over the economic implications from a fast-moving virus in China saw investors moving out of stocks and into safe-haven assets. The Dow Jones Industrial Average lost 453.93 points, or 1.6 percent, to 28,535.80 while those for the S&P 500 index retreated 51.84 points, or 1.6 percent, to 3,243.63. The Nasdaq Composite Index fell 175.60 points, or 1.9 percent, to end at 9,139.31.

European stocks also fell following the same worries on China’s coronavirus. The pan-European Stoxx 600 index and Germany’s DAX both lost 1.7 percent to 416.48 and 13,343.17 with airlines, mining stocks and luxury-goods companies being hit the hardest across the region. The UK’s FTSE 100 lost 2% to end at 7,426.78 and France’s CAC 40 fell 1.9 percent to 5,908.53.

Maltese markets meanwhile posted gains with the MSE Equity Total Return Index closing up 0.232 percent at 9,491.287. Main Street Complex Plc led the risers with shares up 5.45 percent at €0.58, followed by Lombard Bank Malta Plc which gained 4.59 percent to €2.28. Malta Properties Company Plc led the fallers with shares down 3.68 percent at €0.655.

Argentina requests payment delay

Argentina’s Buenos Aires province said on Monday it would offer holders of a 2021 bond a sweetener to agree to a proposal to delay a $250 million amortisation payment until May amid a major debt crunch hitting the country. The province was forced to push back the consent solicitation deadline last week after failing to get sufficient support from bondholders. The government needs holders of 75% of the debt to agree in order to move ahead.

Payment on the 2021 bond marks the first major test for the South American country as it grapples with complex talks to restructure about $100 billion in sovereign debt that the new Peronist government says it cannot currently pay. The province said in a statement that it had received “significant support” from creditors over the proposal, which seeks to push back payment on the bond from its original date of January 26 to May 1.

The province said in its statement that it would sweeten the deal with an interest payment on the deferred capital that would be due within five business days of the amendments going into effect. That would amount to around $28.70 for every $1,000 of deferred capital, the government said.

This article was issued by Peter Petrov, Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article are 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 Investment Services Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.