In Tuesday’s forex trading, buying and selling volumes were more closely matched with funds bought by dealers being slightly above the amounts sold. Dealers bought just over US$13 million in all currencies than they sold.
On Tuesday, dealers bought the equivalent of $25,710,419 versus US$47,763,088 on Monday and sold the equivalent of US$24,985,551 compared to US$34,622,132 on Monday.
In US dollar trading, dealers bought US$23,198,261compared to US$42,021,074 on Monday as the buying rate for the US dollar, slipped 6 cents to $112.08 and sold US$22,007,235 versus US$31,275,581 on Monday, as the rate eased 7 cents to $112.63.
The Canadian dollar buying rate rose 13 cents, to $102.93 with dealers buying C$852,194 and selling C$750,104 as the rate fell 9 cents, to $105.21.
The Pound closed at $189.29, for the purchase of £962,129 down 93 cents, while only £896,565 was sold, with the rate climbing by 40 cents, to $192.68. Other currencies bought, amounted to the equivalent of US$104,562 while selling was the equivalent of US$992,469.
Highs & Lows| All the highs and lows at the end of trading that moved declined. The highest rate for buying the US dollar, closed with a loss of 10 cents at $113.10, the lowest buying rate and the highest selling rate remained unchanged at $91.85 and $117.70 respectively, while the lowest selling rate dropped back by 16 cents cents to $91.85.
The highest buying rate for the Canadian dollar declined by 30 cents, to $105.05 and the lowest buying rate and the highest selling rate and the lowest selling rate were unchanged at $83.21, $107.21 and $100.25 respectively.The highest buying rate for the British Pound, fell 30 cents to $193.30, while the lowest buying and selling rates were unchanged at $153.88 and $185.40 respectively, the highest selling rate fell $3.36 to $195.66.
Jamaican dollar gains versus US & Canadian
Lousy Monday trading on JSE
Monday’s trading on the Jamaica Stock Exchange was very moderate, as the prices of 3 stocks rose, 6 declined and 18 securities changed hands, resulting in 1,001,293 shares trading valued at a mere $4,627,847.
Main Market| By the close of trading the JSE Market Index inched up by 71.70 points to 70,259.21 and the JSE All Jamaican Composite index moved up 80.17 points to close at 77,270.76.
Gains| Stocks recording gains at the end of trading in the main market, are Grace Kennedy with 7,725 units as the price gained 99 cents to $55, Pan Jamaican Investment traded only 1,558 shares but gained 25 cents, to land at $48.26 and Scotia Group with 94,278 units changing hands, gained a cent to close at $18.51.
Firm| The stocks in the main market to close without a change in price, are Carreras with 10,224 shares closing at $33.60. Mayberry Investments traded 3,943 units and closed at $1.55, Seprod traded 5,000 units and ended at $10.50 and Supreme Ventures traded 11,500 units to close at $1.95.
Preference| Jamaica Money Market Brokers 7.50% preference share traded 2,000 units at $2.
Declines| The number of stocks declining in the main market, are Cable & Wireless with 502,916 shares, while losing 2 cents to end at 25 cents, Jamaica Broilers with 76,626 shares, lost 3 cents to close at $4.57, National Commercial Bank with 8,475 units, closed with a 2 cents loss at $18, Sagicor Group in trading 115,510 shares lost 5 cents to close at $9.05 and Sagicor Real Estate Fund, exchanged 4,500 units for 10 cents lower at $6.30.
Junior Market| The JSE Junior Market Index declined by 8.99 points to close at 679.40 as 5 securities traded, with none advancing and one declining.
Firm Trades| Stocks in the junior market that traded to close at the same price as the day before, are Caribbean Cream with 38,240 shares to close at 70 cents, Jamaican Teas with only 698 units at $3.25, Lasco Financial Services with 29,100 shares to close at $1 and Medical Disposables & Supplies with 86,000 shares at $2.
Declines| The only stocks declining in the junior market at the end of trading is Lasco Distributors with 3,000 units to close down 10 cents at $1.20.
IC bid-offer Indicator| At the end of trading the Investor’s Choice bid-offer indicator had 10 stocks with bids higher than their last selling prices and 4 stocks with offers that were lower.
Is the real estate price right?
In the heady days when Olint, the forex trading company was around, and many clients of that entity were reaping 10 percent per month, persons were paying almost as much for used residential units as new ones.
Apartment complex at East Oakridge in Kingston 8
How can an investor get a good idea if the price is about right? Be like a valuator, do comparison pricing. A good place to start getting information on selling price per square foot are ads selling properties, especially new ones. Houses are of different sizes and make up, but by and large they have one thing in common, that is square footage. If the square footage is known, the value per square foot should be computed for all units, then prices can compared, because there is a common measuring rod. Without reducing values to a common measure, it becomes difficult to determine if one property is appropriately priced or not.
Interior of Model unit at East Oakridge apartment complex
Some advertisements and a news item in the newspapers, provide some useful information as to where values are in the local market currently. Location of course is an important element of pricing, this is not factored in here. The information gleaned have values per square foot, ranging form a low of $10,000 for lower income units to a high of $25,000 per square foot for a Montego Bay waterfront property. The typical upper income units seem to be price around $22,000 per square foot for units of 600-700 square feet to $16,000 to $20,000 on the upper end for larger units. Older units would normally be valued based on be discount from the current selling prices of new units for their age, at around 2 percent per annum.
According to a Sunday Gleaner publication on July 20, 2014 Real-estate developer Matalon Homes is investing in a residential project called Welwyn. Construction of the luxury townhouses and apartments at Millsborough in St Andrew is to last a year. The units are priced at US$210,000 for the apartments of 1,100 square feet and US$420,000 for the townhouses comprising 2,100 square feet or approximately $23.6 million and $47.3 million respectively. The selling price works at $21,570 and $22,250 per square foot respectively.
Apartment unit at Montego Freeport, priced at $25,000 per sq. Ft.
In East Oakridge, Kingston 8 area, there are 1 and 2 bedroom apartments of 986 and 1,486 square foot, priced at $19 to 24 million or $19,250 and $16,150 per square foot respectively.Over in Montego Bay, The Landings at the Spring Gardens, have studios of 872 square foot going for US$131,000 to US$137,000 or J$17,000 per square foot and 2 bedrooms of 1,575 square foot, going at US$219,000 t0 $229,000 or $15,700 per square foot. There is the requirement for 35 percent deposit in two tranches. Over at Montego Freeport, there are also units selling at $25,000 per square foot. While, properties in the main cities are going at the above prices for new units, out in rural Jamaica, smaller units of 800 square feet are priced around $10,000 per square foot. Many of these tend to be built on cheaper lands than say in Kingston, they are also benefit from the fact that the developers are building hundreds of them in one community thus enjoying economies of scale.
Phillips & Wynter kill inflation in Jamaica
Many Jamaicans may be feeling the negative effect of the economic pressures the country is undergoing. One area in which it is seen, is the official data on inflation as the overall measure of consumer price movements, went virtually nowhere, in June.
Inflation in Jamaica is set to hit the lowest level, in years if the trend for the first six months of the year continues. According to data put out by the Statistical Institute of Jamaica, the inflation rate for June is 0.1 percent, when compared to the index for May 2014. This is 0.9 percentage points lower, than the 1.0 percent recorded for May this year. The lower movement was mainly due, to a decline in the cost of electricity which resulted in the index for the group ‘Electricity, Gas and Other Fuels’ moving down by 4.2 percent. This fall was tempered by an increase of 3.6 percent, due to an increase in the cost of water. Food and Non-Alcoholic Beverages rose by 0.6 percent. Upward movement in the prices of ‘Meat, ‘Milk, Cheese and Eggs’ and ‘Bread and Cereals’ were the chief contributors.
The movement in the index for June 2014 resulted in a calendar year- to-date inflation rate of 2.5 percent.
Mean quarterly inflation rate for the second quarter of 2014 was 1.1 percent, 0.3 percentage points lower than the first quarter which had an inflation rate of 1.4 percent.
Jamaican Teas Orchid unit to open soon
Residents of Yallahs, St Thomas and surrounding areas, will shortly be able to view a model of a new real estate development that has gone on sale in the area. Orchid Estate, Jamaican Teas second real estate development, located in Yallahs, St Thomas, will shortly be opening its model unit for public viewing. The accompanying pictures show units being readied for sale.
According to information gleaned by IC Insider, the model unit will be on display this week end. The units which are priced at $7.9 million comprise 2 bedrooms each. When completed the scheme will encompass 71 units.
Jamaican Teas is a company listed on the junior market of the Jamaican Stock Exchange, that is primarily involved in the processing of teas and other beverages for the Jamaican and export markets, operates of supermarkets and real estate development. It successfully completed its first residential real estate development in 2013, when it built and handed over 19 super studio units to purchasers of its Carmen Court Apartment complex in Kingston.
Gary Powell KLE director dumps shares
Craig Powell, a director and second largest shareholder in KLE Group dumped part of his holdings in the floundering group, during Friday’s trading on the Jamaica Stock Exchange.
Stocks and Securities acting as brokers, on behalf of the seller and buyer executed the trade at 90 cents each, for the 7,181,043 units that Powell owned. Powell should pocket just under $6,462,938 from the sale, down substantially, from the $26.6 million value placed on it, at the time of the IPO. The amount represents a portion of 10,693,750 that the company’s prospectus said he held prior to the issuing shares to the public in 2012, and now leaves him holding 3,201,343 units. At the time of the IPO, the amount represented 14.64 percent of the total issued shares, after the issue it would have come down to 10.70 percent, the prospectus stated. Powell’s holding after the public issue was second only to Gary Matalon’s holdings of 13.69 percent. At the time of the public issue Usain Bolt’s Sherwood Holdings Limited held 6,757,000 in the company. KLE’s 2013 annual report, lists Sherwood as still owning them.
Who is Powell?| The KLE prospectus list Powell’s credentials as follows: “Non-Executive Director he was appointed September 8th, 2008. Powell has over twenty-four (24) years’ experience in management and event marketing and promotions. Powell’s work experience spans operations management at the Sunset Jamaica Grande Hotel, regional sales and marketing at Amalgamated Distributors Limited and management at Midel Distributors Limited.
Powell also has a wealth of experience in the event-planning and entertainment industry, having been a principal in many of Jamaica’s premier entertainment attractions and events, such as The Appleton Estate All-Jamaica Grill-Off, which is perhaps the only event of its kind in Jamaica.
Powell also has substantial agricultural investments, which includes the production and export of produce and has an interest in Jamaica Hydroponics Ltd., a company that grows and distributes vegetables to hotels and retail outlets. Jamaica Hydroponics Limited owns and operates the largest hydroponics farm in Jamaica.”
KLE Group has been bleeding badly, having made a loss of $56 million in 2013, it followed that up with a loss of $13 million in the March quarter this year, but this was an improvement on the $17 million loss they suffered in the March 2013 period.
Dealers buy US$81m, sold US$77
Image courtesy of Marcus/FreeDigitalPhotos.net
155% profit surge at JNBS
Profit after tax surged 155 percent at Jamaica National Building Society, for the year to March 2014 to reach $2.3 billion from only $908 million in the previous year. The improvement came from revenues of $15.7 billion compared with $14.7 billion in 2013.
The 2013 result was negatively affected by a $830 million hit the group got from the government of Jamaica debt swap, where higher yielding bonds were exchanged for lower yielding ones, leading to a write down of market value of the bonds they held, at the time of the debt swap. But even without such one off charge, profit in 2014 would still have been up by a respectable 25.5 percent. To achieve the results, operating expenses were held to an increase of only 5.8 percent.
At the end of the March, assets climbed by 12.3 percent to $162.46 billion, from $144.6 billion at March 2013. Of the total assets, loans made up just $60 billion or 37 percent. There were mortgages approved but not yet disbursed amounting to $2.685 billion at the end of the year versus $2.344 billion at March 2013. Investment securities made up the bulk of the other assets. Equity capital stood at $26.8 billion and savers deposits at $86.6 billion.
Huge 61% JSE fee hike but stocks drop 45%
Investors in public listed companies on the Jamaica Stock Exchange got a huge 25 percent hike in cess they have to pay for trading on the stock exchange effective July 1, 2014. The Jamaican Stock Exchange hiked the fee investors are charged by when trading shares from 0.20 percent on each side of a trade to 0.25 percent. Since 2004 the exchange hiked fees by 61 percent while stock values are down around 45 percent since peaking in 2005.
Worse, stock investors who were getting dividends tax free, saw the re-enactment of two tax increases in the past three years. Stock market investors have gotten hit on all fronts with less income form share ownership over the past several year as they see their investment shrink in most cases. Customers of the exchange without whom the stock exchange cannot be viable, have been buffeted on all sides with no entity looking after their interest.
The fee levied on transactions across the floor of the Exchange will be increased by 0.10 percentage points or 0.05 percentage points on each side of a transaction.
The cess charge will be reflected on brokers, Contract Notes for each transaction will be 0.25 percentage points on each side of a transaction effective July 1, 2014 a release from the Jamaican Stock Exchange stated. The recent increase the second such increase from 2012 and the third since 2004.
In 2012 shareholders of public listed Companies on the Jamaica Stock Exchange started paying additional charges effective March 1, 2012 when the cess levied on transactions across the floor of the Exchange was increased by 0.0075 percentage points, or 0.00375 percentage points on each side of a transaction. The cess charge will be 0.2 percentage point on each side of a transaction. On October 1, 2004 the JSE increased its cess from 0.15625 percent to 0.19625 percent.
Big improvement in balance of payments
There is a major improvement in Jamaica’s Current Account deficit for the March 2014 quarter, according to a report out of Bank of Jamaica. Lower imports partially offset by lower exports and improved service inflows led to an improvement of US$301 million the deficit of US$401 million in the March 2013 quarter, resulting in a deficit of US$101 million.
“The outturn for the 2014 first quarter is the second lowest current account deficit recorded since 2007” the country’s central bank states. The improvement in the Goods Account was due to a significant decline in imports which was partially offset by decline in exports. The decline in Imports of US$281 million was primarily driven by a US$172 million and a US$133 million decline in chemicals and mineral fuels imports, respectively. The decrease in exports was primarily attributable to a US$86 million and a US$31 million decrease in chemical and crude material exports, respectively, partially offset by an increase in the exports of manufactured goods of US$21 million.
An increase of US$31 million to US$270 million in the balance on the Services sub-account resulted primarily from improvements in transportation and travel services of US$33 million and US$18 million, respectively. The improvement in transportation resulted from reduced freight costs associated with the reduced imports, while the increases in travel receipts occurred due to a 3.3 in visitor arrivals.