21 27 March 2001
Falls expected in Maltese Stock market
Drop of 12.82% in two and a half months
Maltese investors should be warned to expect further falls in the stock market. This is the general feeling among some financial analysts.
However there is a fine line between financial analysts and fund managers in Malta.
Since the beginning of the year, the Maltese stock market's index has plummeted from 3,375 to 2,942 in just two and a half months, a drop of 12.82%. A comparison with the FTSE 100 index shows a similar trend but with only a drop of six per cent.
The falls has worried many people and investors have been cautious.
With little on no analysis on the performance of listed companies, many small investors feel left out and confused.
As in all cases, small investors have been the ones to suffer most.
The main concern, which is not being voiced locally, is the future of the American economy, which still bears and will continue to influence the workings of other markets including Malta.
It is expected that the next 18 months will see a slowdown in the American economy and this will influence and affect the European markets including Malta.
Traditionally, such scenarios beckon investors to buy more shares now, or sell them.
Others read the market as being corrective.
The three evaluations have perhaps also contributed to the uncertainty in the market.
But the underlying message is that there is no one out there to advise the investor on what to do.
Indeed, some local stockbrokers still consider analysis to be equivalent to interference.
And although two indicators of a bright future are low inflation and low unemployment, the local markets remain intrinsically linked to the global changes around us.