Deflation continues to April

Price fallJamaica is currently passing through a period of deflation according to data released by the Statistical Institute of Jamaica. According to the state entity responsible for gathering economic data, the consumer price index declined for the 4th consecutive month to April compared with the prior months, with the rare falling 0.40 percent in April compared to March 2016.
For the year to date there has been negative inflation of 1.7 percent.
The data was released today by the Statistical Institute of Jamaica (STATIN). According to STATIN “impacting the movement were the divisions Food and Non-Alcoholic Beverages recording a negative 0.5 percent and Housing, Water, Electricity, Gas and Other Fuels declining by 2.2 percent”. The fall recorded for the division Food and Non-BananasAlcoholic Beverages was due primarily fall in the prices of the group of Vegetables and Starchy Foods, falling by 2.6 percent. Housing, Water, Electricity, Gas and Other Fuels decrease, was due to lower electricity and water rates. Increased prices were seen Transport, due mainly to higher prices for petrol, Clothing and Footwear, Furnishings, Household Equipment and Routine Household Maintenance, Health, Recreation and Culture, Restaurants and Accommodation Services and Miscellaneous Goods and Services.

Jamaica’s $ competitiveness may be up 5%

J$ - 500front The Jamaican dollar may have gained 5 percent in competitiveness for the year to date against the US dollar. The closing selling rate for 2015 ended at $120.42 and has so far slipped by 3.5 percent to Monday, with inflation being negative 1.7 percent between January and April this year, the Jamaican dollar has picked competitiveness above the change in the rate of exchange.
The foreign exchange market closed on Monday, with dealers buying the equivalent of US$47,761,762 and selling US$44,338,122, in contrast to US$35,541,148 purchased and US$47,935,497 sold on Friday with the rate for the important US dollar rising to record new lows for the Jamaican dollar.
In US dollar trading, dealers bought US$44,507,300 compared to US$32,883,247 on Friday, as the buying rate for the US dollar rose 5 cents to $123.83.FX Sum-16-05-16 A total of US$42,340,729 was sold versus US$41,138,924 on Friday with the selling rate rising 8 cents to $124.65. The Canadian dollar buying rate dipped 8 cents to end at $92.26 with dealers buying C$1,069,725 and selling C$866,429, at an average rate that rose 86 cents to $96.50. The rate for buying the British Pound fell 89 cents to $174.92 for the purchase of £1,621,031, while £658,096 was sold, with the rate falling $1.81 to $177.42.
At the end of trading, the selling rate for Euro, fell $1.08 to close at J$140.75, from Friday’s rate, according to data from Bank of Jamaica, while dealers purchased the European common currency at J$137.76, for a fall of $1.14 from Friday’s rate. The US dollar equivalent of other currencies traded amounts to US$167,489 being bought, while US$390,004 was sold.
FX HL -16-05-16Highs & Lows| Notable changes to the highest and lowest rates the Jamaican dollar traded at in the foreign exchange market on Monday, include, a decline in the highest selling rate of $29.21 for the US dollar to $130.79, a drop of $19.40 in the lowest selling rate to end at $100.70. There was a rise of $3.45 in the highest buying rate of Canadian dollar to end at $98.75 and a rise of $3.11 in the lowest buying rate to end at $76.11, while the lowest selling rate fell $2 to $89. The highest buying rate for the British Pound dropped $3.35 to $179.65 and the highest selling rate slipped $1.08 to $184.68.

New records for 3 stocks – Monday

JPSCo trades at new high on Monday at $1,247.

JPSCo trades at new high on Monday at $1,247.

Grace Kennedy, Pan Jamaican Investment and Jamaica Public Service 9.5% preference share shot to new 52 weeks high on the main market of the Jamaica Stock Exchange at the close of trading on Monday. The market closed with 37 securities changing hands, accounting for 23,413,479 units valued at $218,207,605, in all market segments. The junior market had only 632,321 units traded, valued at $2,290,950.
Investors pushed the price of 16 stocks in the overall market up, 11 down, including 5 stocks rising and 6 declining, from the junior market.
The JSE Market Index jumped 1,484.96 points to end at 153,251.61. The all Jamaica Composite Index shot up 1,660.74 points to close at 170,223.05 and the JSE combined index rose 1,336.47 points, to close at 164,523.28.
JSE Sum-16-5-16 IC bid-offer Indicator| At the end of trading, in the main and junior markets, the Investor’s Choice bid-offer indicator reading showed 10 stocks with bids higher than their last selling prices and 6 with lower offers.
At the end of market activities, Cable & Wireless lost 2 cents and closed at $1.47 after trading 132,302 units, Ciboney traded 100,000 shares to close at 13 cents. Grace Kennedy shot up $4.49 with 14,300 shares trading to close at $90. Jamaica Broilers ended at $14.50 while trading 306,339 shares, Jamaica Producers fell 90 cents to $32 with 58,803 units changing hands on a day the company advised the stock exchange that the directors will be meeting to consider a stock bonus. Jamaica Stock Exchange had 35,549 shares trading at $21, JMMB Group traded 94,284 shares at $9.99, for a 14 cents gain. National Commercial Bank traded just 5,551 shares, to close with a gain of 25 cents at $40, JSE MM fn qts 16-5-16Pan Jamaican Investment jumped $5 to close trading at $125 with 26,773 shares changing hands, Radio Jamaica traded 67,645 shares at $1.10, Sagicor Group ended with 145,082 shares changing hands, but lost 20 cents, to end at $22.80. Scotia Group closed at $30.50 while only 3,000 units changed hands after gaining 49 cents, Supreme Ventures closed at $4.50 with 21,308,893 shares valued at $96,057,185 changing hands after declining by 97 cents. Proven Investments traded 25,980 shares at 17.50 US cents, Jamaica Money Market Brokers 7.5% preference share ended with 366,900 units trading at $2.14 and Jamaica Public Service 9.5% preference share climbed $46, in trading 81,662 units with a value of $101,832,514, to end at a record of $1,247.

$1.275m threshold for all

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Minister of Finance Audley Shaw

Minister of Finance Audley Shaw

Minister Audley Shaw, announced an across the board threshold for individual tax payer of $1.275 million, effective July 1 this year, and to move it to $1.5 million, starting April 2017.
Shaw stated that 251,000 persons will benefit from the plan which is said to cost $12 billion in this fiscal year. The Minister announced a series of tax measures to fill the gap caused by the shortfall arising from the tax plan. Taxes will go up on cigarettes, petrol, heavy fuel, LNG and departure tax.
Tax payers earning over $6 million per annum will pay taxes above the threshold at 30 percent instead of the current 25 percent.
The Minister stated that the plan is to move from direct taxation to indirect taxation with the expectation to fully phase out personal tax.
Shaw presentation place a great deal of focus on growth and development, including focus on improved infrastructure including extension of the south coast highway to Negril.
The minister projected economic growth at 1.8 percent for the fiscal year up from 0.8 percent for the 2015/16 fiscal year. The Minister also stated the drive for comprehensive tax reform to be pursued.

Grace Kennedy’s blow out quarter

Grace Kennedy profit for Q1 jumped 153%

Grace Kennedy profit for Q1 jumped 153%

Grace Kennedy reported a 153 percent jump in it results for the first quarter ending March with profit after tax of $1.5 billion versus $589 million in 2015. Grace reports that $606 million of the increase came from disposal of investment, with the bulk of it coming from the liquidation of a subsidiary.
Earnings per share ended at $4.51 compared to $1.78 in 2015 and the full year’s earnings looking to exceed $13 per share.
Grace reported sales revenues of $22 billion up from $19.36 billion in 2015, with profit from operations doubling to $1 billion, while other income amounted to $991 million up from $316 million in 2015.

Group Chief Executive Officer, Don Wehby steering the Grace ship to safer waters.

Group Chief Executive Officer, Don Wehby steering the Grace ship to safer waters.

The food and trading division enjoyed the most growth, moving from $398 million to $855 million, the banking and investing segment recorded lower profits of $29 million than the $89 million in the 2015 period, while the money transfer segment, continues to deliver attractive increases of 26.5 percent, with profit of $587 versus $464 million and the Insurance division went up 48 percent from $67 million to $99 million.
The company attributed the strong increase in the food and trading division to “improved performance of our food distribution and manufacturing business in Jamaica and internationally.”
Grace’s stock has come in for increased demand on the Jamaica Stock exchange over the last few trading days, with the price closing at $84 on Thursday with 1,021,582 units traded.

$1m for 2016, $1.5m in 2017

Minister of Finance Audley Shaw should announce a $1m plan for 2016 and $1.5m for 2017 in his budget presentation today.

Minister of Finance Audley Shaw should announce a $1m plan for 2016 and $1.5m for 2017 in his budget presentation today.

The promise by the JLP to make earnings of PAYE individuals up $1.5 million, tax free has undergone much discussions as to the feasibility for it to be funded. Few commentaries have focused on the growing revenues of the government and the reality that revenues tend to increase in line with nominal GDP growth.
At the same time, interest cost on the government debt, will decline as interest rates fall, notwithstanding the increased amount in the budget this time around for interest. The increase is to accommodate the interest on the Petrocaribe Fund debt which will be recovered from the Fund.
Interestingly, former Prime Minister Bruce Golding and an active participant in the 2016 election campaign for the JLP gave a speech in April in which he suggested that the implementation should be done to maintain simplicity and equity in the system. He made two proposals. The more important one was for an across the board threshold of $1 million. It would appear that Golding was testing the waters for a modification in the $1.5 million plan at least initially, that would have affected only some on the PAYE system.
Jamaicans should get the news that for 2016 the PAYE threshold will be $1 million, with it going to $1.5 million during 2017. It is unclear if the $1.5 million will be across the board or not. But with tax reform to be implemented probably in 2017, it seems as if it will be an across the board threshold.

Bank customers face $5,000 charge?

J$5000Jamaica’s commercial bank customers could face a $5,000 charge for each transaction made through banks above the threshold of $1 million by way of cheques commencing May 2, this year. The central bank – Bank of Jamaica announced a lowering of the amount that can be allowed through the Automatic Clearing House (ACH) to $1 million without a charge and amounts of cheques over that level will incur the $5,000 charge. Banks will pass the charge onto their customers.
According to the release from the central bank, “banks will be required to target 100% of all payments and transfers that are above the $1 million threshold for migration to JamClear®-RTGS.
The following will become applicable with regard to compliance with the stated target: Commercial banks that are fully compliant with the targeted threshold of J$1 million for those payments and transfers that are processed through the ACH will incur no charge. Commercial banks that are not compliant with the targeted threshold of J$1 million for those payments and transfers that are processed through the ACH will incur a charge.
Bank of Jamaica disclosed that “the decision was informed by extensive discussions and is fully supported by the National Payments Council of Jamaica. The new threshold marks the culmination of the phased programme to significantly reduce, if not eliminate, settlement risk to the safety and security of the national payment system which is posed by large value transactions that are processed through the ACH for settlement on a deferred net settlement basis.”

Juniors move up on Tuesday

Honey Bun closed at a new high of $19.50 on Tuesday.

Honey Bun closed at a new high of $19.50 on Tuesday.

The junior market inched forward at the close on Tuesday, with 1,364,688 shares valued at $9,672,342 changing hands. The market index added 11.24 points to end at 2,168.15 as a total of 15 securities traded, with 7 advancing and 3 declining.
The junior market ended with bids for 5 stocks closing higher than their last selling prices and 3 ended with lower offers.
At the end of trading, Caribbean Cream traded 68,300 units and gained 20 cents to end at $5, Consolidated Bakeries ended with 7,500 shares changing hands at $1.23, Dolphin Cove had only 162 units trading with a gain of 20 cents to end at $12.75. General Accident Insurance gained 5 cents while trading 432,078 units to close at $2.65, Honey Bun closed at a new 52 weeks’ high of $19.50, after rising $1.50, with 49,201 shares trading. Jamaican Teas traded 20,896 shares to end at $3.90 after it traded earlier at $3.80. Jetcon Corporation closed at $3 while 8,000 units traded, KLE Group fell 20 cents in trading 57,164 shares and closed at $1.40, JM Trdng Sht-10-5-16Knutsford Express had 19,430 shares trading, but lost $1.90 to end at $17, Lasco Distributors closed with 112,755 units trading at $7.55, Lasco Financial closed at $3.49 with 13,000 shares changing hands. Lasco Manufacturing closed at $4.60 with 69,460 shares trading, to gain 10 cents, Paramount Trading ended with 500,000 shares changing hands at $10.99, after rising 19 cents, Derrimon Trading 11.75% preference share closed with 1,742 units trading at $2.13, to add 1 cent and Eppley cumulative redeemable preference share eased 1 cent with 5,000 units changing hands at $6.09.

Another big jump for Eppley on Tuesday

New high for Eppley

New high for Eppley

Eppley jumped again in the early morning session on the Jamaica Stock Exchange, to add $69.24 to the $75.76 gained on Monday as 160,000 units of the stock traded at a new 52 weeks’ high of $650 to record a gain of almost 29 percent in two days.
The trade took place as the company announced that up to 487,703 new ordinary shares priced at $650 each will be made available to ordinary stockholders on the record date for the issue, on Friday 6 May 2016. On Monday Eppley climbed 15 percent for a gain of $75.76 to close at $580.76. At the close, there were two 52 weeks’ highs with 14 active securities trading, as 6 advanced and 4 declined as the junior market index slipped 0.77 points, to end at 2,158.56. A total of 1,253,040 shares valued at $109,112,009 traded. 4 stocks closed with bids higher than their last selling prices and 3 ended with lower offers.
At the end of trading in a market, Caribbean Cream traded 2,450 units and rose 30 cents to end at $4.50, Caribbean Producers had 1,000 shares changing hands at $4.01, General Accident gained 5 cents in trading 3,600 shares to close at $2.70, Honey Bun fell 95 cents to end at $17 with 37,988 shares trading. JM Trdng Sht-03-5-16Jamaican Teas traded 8,900 shares and lost 9 cents to end at $3.91, Jetcon Corporation ended at $2.90 while 608,524 units traded. Key Insurance traded 25,121 shares to end at $2.80, Knutsford Express had 2,900 shares trading unchanged at $16.80. Lasco Distributors gained 10 cents and ended at $7.60 with 130,860 shares trading, Lasco Financial gained 10 cents to close at $3.50 with 120,661 shares changing hands. Lasco Manufacturing lost 1 cent to close at $4.59 with 78,836 shares trading, Medical Disposables traded 1,200 shares to close 22 cents higher at $3.42 and Paramount Trading fell 15 cents to end with 71,000 shares changing hands at $10.85.

Eppley adds $69 in early trading – Tuesday

Insurance premium financer, Eppley jumped again in the early morning session on the Jamaica Stock Exchange, to add $69.24 to the $75.76 gained on Monday as 160,000 units of the stock traded at $650 to record a gain of almost 29 percent in two days. The trade took place as the company announced that up to 487,703 new ordinary shares priced at $650 each will be made available to ordinary stockholders on the record date for the issue, on Friday 6 May 2016.
Eppley has 796,249 ordinary shares issued currently. The amount traded represents 20 percent of the issued shares. NCB Capital; Markets bought 41,716 units with the rest being crossed by Mayberry for clients.
ICI int sht 03-05-16Berger Paints traded 132,384 shares to gain 10 cents to $4.10 and was the only one other security trading over 100,000 shares. Honey Bun trading just 2,000 shares hit a new high of $18.
After 77 minutes of trading, on Tuesday, the average volume traded amounts to 25,536 units per active stock, compared to an average of 19,944 units in the mid-morning session on Monday. Notwithstanding the low volume, the main market indices record gains but the junior index declined.
Trading resulted in activity in 20 securities, accounting for 638,410 shares changing hands as 13 stocks gained and 6 declined.
The market saw the all Jamaica Composite Index gained 387.32 points to 170,888.73, the JSE Market Index rose 346.33 points to 153,846.84, the JSE combined index ended with a rise of 230.74 points to 164,768.46 and the junior market index eased 8.83 points to 2,150.50.