Jamaica’s growth crawls along at 1.8% PA

Construction secrtor contributed to increased growth in Q3.

Economic growth in the Jamaican grew 1.8 percent in the third quarter of 2018 over the similar quarter of 2017. The performance result in gains in the Goods Producing and the Services Industries.
The goods producing sector grew by a strong 5.1 percent but the services sector was up just 0.7 percent over the similar period in 2017, the report from the Statistical Institute of Jamaica (Statin) stated in their release on the performance on the local economy for the third quarter of the year.
According to Statin, all industries within the Services Industries recorded higher levels of output with the exception of Electricity & Water Supply which declined by 0.1 percent and the Producers of Government Services which remained unchanged for the period. Increases were recorded for: Wholesale & Retail Trade; Repairs; Installation of Machinery & Equipment (0.8 percent ), Hotels & Restaurants (2.1 percent ), Transport, Storage & Communication (1.4 percent ), Finance & Insurance Services (0.7 percent ), Real Estate, Renting & Business Activities (0.5 percent ) and Other Services (1.2 percent ).

Mining was the biggest contributer to GDP gains in Q3.

Hotels & other short-stay accommodation benefited from a 3.8 percent increase in foreign national arrivals, the report stated. The Goods Producing Industries grew due to increased output in Mining & Quarrying, up 51 percent due mainly to the reopening of Alpart refinery and Construction up by 3.7 percent due to increased activities in the civil engineering sub-group. The major contributor to this growth was work associated with the continued expansion of road infrastructure. However, Manufacturing declined by 0.3 percent due mainly to lower production levels, in petroleum refining and non-metallic minerals. Agriculture, Forestry & Fishing remained unchanged. The growth for the third quarter brings real growth for the year to September to 1.8 percent over 2017. Gross domestic product for the calendar year, grew 0.9 percent in 2015, 1.4 percent in 2016 and 1 percent in 2017.

JSE in big rise Friday morning

The main market of the Jamaica Stock Exchange surged 11,371 points on the All Jamaica Composite index (AJI) with nearly 2 hours of trading on Friday with the index at 408,686.63 points but pulled back to be at 406,567 points at 11:30 up 9,251.52 points.
The JSE Index climbed 10,360.40 points to 370,428.51 but the Junior Market Index slipped 5.01 points to 3,184.75. The rise so far still leaves the AJI short of the 11,126.51 points lost over the past two trading days.
NCB Financial traded at $146.83, Barita Investments traded at a new high of $50, Sagiccor Real Estate Fund jumped to $13.95 while Salada Foods traded at a new high of $35 but pulled back to $30 after. JMMB Group that traded 327 million shares traded 20.7 million shares today.

Proven buys NCB’s block of JMMB shares

NCB Financial Group sold all the JMMB Group shares amounting 326.7 million units amounting to 20 percent of the total issues shares of the money market brokerage.
The shares were put through the Jamaica Stock Exchange only a few minutes after trading opened today, at $28.25 each and resulting in a consideration of $9.2 billion.. In September this year, PanJam Investment purchased 100 million or 6.1 percent of JMMB shares from NCB, leaving the block that was traded today. A spoke person for PanJam, indicated that they are not the buyers of today’s trade. Our sources indicate that Proven Investments are the buyers of the block today.

BOJ senses pick up in GDP growth

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Economic activity may has picked up pace in the latter half of the year compared with the first half, with a strengthening in real GDP growth and employment over the second half of the year, Bank of Jamaica is suggesting.
The central bank was commenting on the increase in money in circulation for December. “This projected acceleration in the growth in real currency demand for December 2018 is consistent with the higher growth rate that has been evident between August and November 2018,” the central bank stated. Economic growth in the June quarter was preliminarily placed at 2.2 per cent by the Statistical institute of Jamaica.
The bank went on to say, “when the forecasted change in the general level of consumer prices is taken into account, the projected real growth in currency for the 2018 is 10.5 percent, which is higher than the real growth of 7.3 percent for the previous year.”
The projected currency stock of $128 billion at end-December 2018 represents an annual growth of 15.5 percent, an acceleration when compared with the 12.9 percent recorded at December 2017.
Bank of Jamaica projects that the value of currency issued by the Bank will increase by approximately $18 billion (or 16.5 percent) in December 2018 to end the month. The central bank states that the projected growth for the month is broadly consistent with the 16.5 percent growth recorded for December 2017 as well as the five-year average growth rate of 17.3 percent for December.
BOJ net issued $4.2 billion in currency for December up to 14, this year (representing a 3.8 percent growth for the month to date). This compares to net currency issue of $1.4 billion over the same period in 2017.

Crude oil sinks below U$49

The price of crude oil on the world market sank to US$48.49 in early morning trading, the lowest levels since October 2017. The price peaked at US$76.10 in early October this year.
The trend suggests that the price will go even lower with increasing supplies said to be coming from production in the USA and concerns that the global economy is slowing and would use less oil.
The change in price has significance for the Caribbean region that are mostly net importers of oil, as well as Trinidad and Tobago who are producers of oil, and will earn far less income from the lower price. For Jamaica, it is likely to tame inflation as it did in November, when the country recorded zero inflation. It will also make the Bank of Jamaica’s inflation target of 4 to 6 percent targeting for the current fiscal year that the Country’s Central bank states was set by the Minister of Finance and the Public Service in September 2017, far more challenging than it was before.
If the price remains below the US$50 mark for a prolong period, then Jamaica could save somewhere in the region of US$$300 million per annum and that could positively affect the exchange rate, for the local currency.

No inflation

Fall in the price of fuel and appreciation of the Jamaica dollar helped in pushing inflation down in November with data out of Statistical Institute of Jamaica (STATIN) showing zero inflation.
According to Statin, the result was influenced by a 0.3 percent increase in the index for the division Food and Non-Alcoholic Beverages. This was as a result of higher prices for vegetables, starchy foods and fruits but was tempered by a 0.8 percent decline in the division Housing, Water, Electricity, Gas and Other Fuels due mainly to reduced rates for electricity despite the increased rates for water and sewage. The Transport division declined by 0.7 percent as a result of a decrease in the price for petrol. The calendar year-to-date inflation was 3.5 percent while the movement in the index for the fiscal year-to-date was 3.8 percent and the movement for the past 12 months comes out at 4.1 percent.

Fontana IPO closed

The Fontana Initial Public Offer for 250 million shares to raised $468 million is oversubscribed and was closed shortly after 9 am today.
The issue which was scheduled to open on Thursday December 13 but and slated to close on 20 December 2018 but heavy demand for the issue forced an early closure. IC insider.com gathers that two brokerage houses delivered around 1,400 applications last night. Up to 1 PM on Thursday, staff at Scotia Investments were still sorting out applications that came in ahead of the closing time. With an historical PE ratio of just over 6 times earnings and around 5.4 times current years estimated earnings the price of the stock is expected to jump sharply after listing. With the plans the company has for expansion the company should enjoy strong growth in profit and stock price for a number of years.

Sharp drop in JSE Indices

The Jamaica Stock Exchange had one of its largest fall with the JSE All Jamaican Composite Index dropping 10,996.27 points to 422,043.60 and the JSE Index nosediving 10,018.84 points to close at 384,529.46 at the close.
Earlier in trading the market had slipped appreciably but dived in the last few minutes of trading with NCB Financial trading at $150 before moving back to last trade at $159 and Sagicor Group down to $140 but last traded at $144. The Junior Market inched higher by 2.46 points.
Scotia Group reported poor final quarter profit and that could weight on the market on Friday.

All Jamaica hits record 433,000 points

NCB trade at a record high of $160.

NCB Financial traded just over 24,000 shares up to 12.30 PM, but jumped to a record $160 to help push the JSE All Jamaican Composite Index by 14,736.82 points to a record high of 433,224.81 and the JSE index up by 13,426.91 points to 394,716.91.
The market opened up at the start of trading with gains of 1,433.80 points for the all Jamaica and 1,306.36 for the JSE index.
The opening high follows Wednesday’s trading when the JSE All Jamaican Composite Index closed at a new all-time high of 418,487.99 and JSE Index ended at 381,289.90.
Barita Investments traded at a new high of $24.01 to more than double in value for the year so far, PanJam Investment traded at $72, Sagicor Group at $51.95 haven risen sharply to a record high, but the bid is at $55 to buy 49,301 shares, Scotia Group trades at $60 and Seprod at $33.65.
The junior market continues under some selling pressure is not sharing in the strong gains of the more matured companies and declined by 20.08 points to 3,158.36.

All Jamaica hits record 427,000 points

The main market of the Jamaica Stock Exchange, has scaled several new highs this trading on Thursday morning on its record run that resulted in the JSE All Jamaican Composite Index hitting a record high of 426,298.79 points after rising 7,810.80 and the JSE index gaining 7,116.53 to 388,406.43 after just 51 minutes into the trading day.
The All Jamaica Composite Index has since broken the 427,000 points mark. The market opened up at the start of trading with gains of 1,433.80 points for the All Jamaica Composite Index and 1,306.36 for the JSE Index.
The opening high follows Wednesday’s trading when the JSE All Jamaican Composite Index closed at a new all-time high of 418,487.99 and JSE Index ended at 381,289.90.
Barita Investments traded at a new high of $24.01 to more than double for the year so far, NCB Financial now trades at $150 and Sagicor Group at $51.92 haven risen sharply to a record high, Scotia Group trades at $60..
The Junior Market continues under some selling pressure is not sharing in the strong gains of the more matured companies and declined by 8.22 a point to 3,170.22.