What’s BOJ up to in FX & money market?

In Friday’s foreign exchange trading, authorised dealers bought much more foreign exchange than they sold and in a late after hours release, Jamaica’s central bank again decided to mop up more local funds from the financial system.

The timing of the release isn’t isolated from the developments in the foreign exchange market. It seems that the CD issue is linked to what the central bank may consider to be holding of a long position in US dollar by financial institutions. According to the release from the bank, the issues are “to augment its liquidity management operations, the Bank of Jamaica will be offering two variable rate instruments commencing Monday, 01 July 2013 to Thursday, 04 July 2013. The release comes against the back drop of the day’s trading when authorised dealers bought more than US$32 million and sold only US$24.5 million with the rate for the US dollar hardly trading.

The instruments being offered are:

  1. Variable Rate Certificate of Deposit 2013(D) which was originally issued on 12 June 2013 and is now being re-opened for a limited nominal amount of $2.0 billion. The tenor for the re-opened instrument is 164-days. This instrument maintains the original issue terms, viz, the initial coupon is 6.77 per cent per annum up to the first interest payment date on 12 September 2013 and re-prices quarterly at 0.15 percentage point above the three month GOJ Treasury Bill rate for the next interest payment date up to the maturity date on 12 December 2013.
  2. A 365-day Certificate of Deposit, for an unlimited amount. The instrument re-prices quarterly at 0.23 percentage point above the three month GOJ Treasury Bill rate existing at the start of each re-pricing period. The initial coupon for the first three months is 6.99 per cent per annum.

These offers are extended to all Primary Dealers and commercial banks, from 01 July 2013 to 04 July 2013. The term sheets for these Certificates of Deposit will be circulated via electronic mail to all Primary Dealers and commercial banks.

The Bank says they will continue to offer its regular 30-day Certificate of Deposit at the current interest rate of 5.75 per cent per annum.

This is the third CD offering within a month and is in conflict with the view that the government wants the rate of the Jamaican dollar to fall as well as utterances from government’s spokesmen that the continuing devaluation is to ensure that the country has a competitive exchange rate. The measures are meant to tighten liquidity which means that there will be less Jamaican dollars  available to purchase foreign exchange thus resulting in either stability in the exchange rate or a revaluation of the currency.

Read more about the BOJ’s intervention in the FX market, Market demand is not driving J$, BOJ is click here.

TTSE: PE ratio chart

In a market with stocks that trade at high PE ratios, this PE Chart shows the potential for price growth and bargains that can be had on the Trinidad Stock Exchange (as of May 2015).

 

 

FX: More buying than selling

Friday, 28th June 2013 | In today’s foreign exchange trading, authorised dealers bought much more foreign exchange than they sold, an unusual occurrence for a Friday. This seems to have signalled to Bank of Jamaica that speculation could be re-entering the market. As such, the BOJ initiated a pre-emptive strike in an after hours move in which they announced two Certificates of Deposit instruments to mop up Jamaican dollar liquidity and pry foreign currency into the NIR in the coming week.

The total amount of currency purchased on Friday amounted to US$32.2 million and selling US$24.5 million. While the actual selling of US dollars was nearly $6 million less than purchases, the selling rate inched down by just 1 cent and the buying rate by 11 cents. There was more buying of Pound Sterling and the Canadian dollars than the amounts sold to end users.

The average selling rate for Canadian dollar gained 4 cents and for the buying rate, 9 cents. The rate for the Pound fell all of $1.18 for the buying rate to close at $152.75 and was down only 6 cents on the selling rate.

Traders dropped the minimum selling rate for three currencies between 5 cent and $1.94, while the highest selling rate hardly changed. The highest buying rate for the US dollar moved up 20 cents but for the Canadian dollar it fell by 20 cents and the pound was also off 50 cents.

FX_TRADE+Currency+Jun28

FX_TRADE+HighLow+Jun28

JSE: Junior market index over 800

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Friday, 28th June 2013 | The junior market index was the only one to advance today surpassing the 800 point level for the first time since November 11, 2011 and is now within a stone throw from the all-time high of 811 points. Although the majority of the indices fell today the advance decline ratio was once again positive with 7 stocks moving up in price whilst 3 declined. Trading levels picked up as 8.19 million shares changed hands with a value of $116.17 million.

There was heavy trading in Carreras shares which fell 77 cents to $52 as 1.146 million units valued at $60.7 million traded, Sagicor Life traded 1.456 million units valued at $12.45 million, Scotia Group traded 563,000 units valued at $11.9 million, and Seprod traded 285,000 units at $4.14 million. Cable & Wireless, which has more than 30 million shares on offer at 15 cents, traded 650,000 units 15 cents each. Jamaica Producers gained 45 cents to close at $18.50 with nearly 25,000 shares trading, Sagicor Investments gained 49 cents but hardly any shares traded.

Proven Preference shares traded 1.7 million units at a value of $8.7 million.

Junior market | Nine junior market stocks traded, as Lasco Financial closed at an all-time high of $13 gaining a $1 in the process, having traded 162,300 share between $11 and $13. Lasco Manufacturing traded over 300,000 shares closing at $15.60 while Lasco Distributors closed at $15.90 with only 73,600 units trading. Consolidated Bakeries moved back to $1.60 at the close while trading 847,000 shares. AMG packaging which had put on 20 cents yesterday while trading a very small amount, closed at $4.20 today with 55,613 shares changing hands and lost 50 cents.

The junior market is in the golden cross which indicates that further big increases are ahead.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 1 stock was higher with 2 stocks that had offers lower than their last selling price.

JSEIndicesJun28

TTSE: Witco’s new high, only 5 stocks traded

Friday, 28th June 2013 | The West Indian Tobacco Company recording a new record trading at 52 weeks high when it closed up by $1 at $117, as 3 stocks enjoyed positive changes in price with only 5 stocks trading with a volume of 217,976 shares valued at $8,117,281.

Neal & Massy Holdings had 94,995 shares changing hands for a value of $5,604,705. Republic Bank traded 10,663 shares at a value of $1,173,112. Angostura Holdings traded 92,274 shares for a value of $830,466. National Flour Mills contributed 15,800 shares to the total amount that traded, with a value of $12,450.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 2 stocks were higher with 4 stocks that had offers lower than their last selling price.

TTSEJun28

 

FX: Moderate change to buying & selling rates

Thursday, 27th June 2013 | There was more selling of US dollar than on Wednesday and less buying by dealers but the actual purchases of US currency exceeded the sales of the US currency by US$7.6 million. There was more buying of the Pound Sterling and the Canadian dollars than the amounts sold to end users. Total buying amounted to the equivalent of US$25.767 million and selling was US$32.72 million.

The average rates for the US dollar inched down by 10 cents on the buy side and moved up 7 cents for sales with the selling rate closing at $101.38. That for the Canadian dollar gained 64 cents for the buying rate but was down 32 cents for the average sell rate, which moved to $96.66.  The rate for the Pound fell 5 cents for the buying rate to close at $153.93 and was down 95 cents on the selling rate to end at $154.54.

Traders drop back the minimum selling rate for the US dollar by $14.31 to $84.19. On Thursday the rate moved by $16.17 to a $98.50 on the day when they bought at 20 cents less or at $101.80 at the highest price from the public than they did on Wednesday. The Canadian dollar traded again today at $96.80 at the high, no change for both the buying at the highs and lows. The lowest rate went up by 45 cents to $92.85 and the highest was down by 27 cents to $99.35. The Pound sterling buying was 30 cents more for the highest rate of $157 and $6.48 less for the lowest buying rate while the selling rates moved up by $1.48 on the highest of $160.71 and the lowest which was $150.2 was greater by $4 than on Wednesday.

FX_TRADE+Currency+Jun27

FX_TRADE+HighLow+Jun27

JSE: Advancing stocks ahead but indices down

Thursday, 27th June 2013 | Trading picked up today as the amount spent on stocks increased to more than $42.8 million as 4.66 million shares changed hands with 27 stocks trading resulting in 11 being up while 6 declined in price. Two new all-time closing highs were reached on the day, a third stock closed at its 52 weeks high and Lasco Financial Services closed at $12 for an all-time closing high. All indices that had stocks that traded declined marginally at the close.

Junior market | Much interest continued in the three Lasco companies as all three traded more than 500,000 units each. Lasco Distributors traded 1,090,159 units at a value of $16.978 million and Lasco Financial Services traded 518,000 at a cost of $5.73 million as the stock closed up 20 cents at $12. Lasco Manufacturing, closed off 20 cents at $15.60 with 531,000 units trading. General Accident traded 467,000 units at $2.04 accounting for $952,000, Access traded 8,988 units at new high of $8.25 while Blue Power had trading in 500,000 units, costing $5 million as the stock retreated 50 cents on the day to close at $10.

Trading took place in the stocks of 9 junior companies. All three Lasco companies approved a 10 for 1 stock split at an extra ordinary general meeting on Wednesday. The record date for the Lasco splits is July 9, 2013 and the ex-date is July 5, 2013.

Main Market | Prices generally recovered from declines earlier in the week even as the indices slipped marginally. While Berger slipped 15 cents to close at $2.30 with 19,000 shares crossing the exchange, Carreras regained $1 off of the amount which was lost yesterday recovering from the initial reaction to the proposed ban on the smoking of cigarettes in public, the stock closed at $53.50, on very small volume. Pan Jamaican gained $2.08 while trading under 3,000 units to close at $52.60, the same level as the bid. Scotia Investments put on $1 to close at $27.50 but only 1,000 units traded. The bid on the stock on Trinidad exchange is at the equivalent of J$28 and it could trade higher as there is little supply in the market currently.

IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 3 stocks were higher with 3 stocks that had offers lower than their last selling price.

JSEIndicesJun27

TTSE: Only 5 stocks trade

Thursday, 27th June 2013 | Only one stock recorded a price change from the last traded price in today’s trading on the Trinidad Stock Exchange the stock price fell moderately. Trading took place in 10 stocks on Thursday as the main market saw a volume of 419,688 shares trading valued at $1,837,719. Buying was much more tempered in the mutual fund market as Clico Investments, the sole trader, amassed a mere 242 shares at a value of $5,566.

Angostura Holdings recorded 148,598 shares changing hands for a value of $1,337,382, Sagicor Financial Corporation had 23,467 shares trading valued at $147,138, Trinidad Cement contributed 161,487 shares at a value of $153,413. National Flour Mills contributed 76,673 shares to the total amount that traded with a value of $57,515.

IC bid-offer Indicator | At the end of trading, the Investor’s Choice bid-offer market sentiment indicator shows that bids for 2 stocks were higher with 4 stocks that had offers lower than their last selling price.

TTSEJun27

FX: Sharp changes in highest lowest rates

Wednesday, 26th June 2013 | The foreign exchange market was characterised mainly by sharp changes in the highest and lowest buying and selling rates than for changes in the average rates for buying and selling of foreign currencies on Wednesday.

Traders hiked the minimum selling rate for the US dollar by $16.17 to $98.50 on the day when they bought at 50 cents more or at $102 from the public than they did on Tuesday. The Canadian dollar was traded at $1.40 less at $96.80 at the high end and 50 cents less on the lowest rates when they bought and sold for 12 cents more or at $99.62 and $1.10 more on at the lowest rate which came in at $92.40. For the Pound sterling buying was 30 cents less for the highest rate of $156.70 and $6.11 more at the lowest buying rate while the selling rates slipped by $2.08 on the highest of $159.22 and the lowest which was $146.20 was lower by $4.55 than on Tuesday.

Total buying amounted to the equivalent of US$26.85 million and selling the equivalent of US$30.57 million.

The average rates for the US dollar inched down by 9 cents on the buy side and moved up two cent for sales with the selling rate closing at $101.31. That for the Canadian dollar fell 29 cents for the buying rate and was up 33 cents for the average sell rate which moved to $96.74.  The rate for the Pound fell 56 for the buying rate to close at $153.98 and was down 12 cents on the selling rate, to end at $155.49.

FX_TRADE+Currency+Jun26

FX_TRADE+HighLow+Jun26

JSE: Advancing stocks clobbers declining ones

Wednesday, 26 June 2013 | While in yesterday’s stock market trading, declining stocks were more than advancing ones with 11 stocks declining and 8 gaining in price, today’s trading not only reversed the negative trend but clobbered declining stocks 16 to 6 with three stocks closing at new 52 weeks high.

The junior market index inched up marginally, to close at 796.02 up 7.19 points. The all Jamaica index declined by 229.71 points to close at 88,512.59 and the main market slipped 127.93 points to 87,135.91 at the close. The fall in Carreras stock which fell $3.50 to $52.50 and Jamaica Producers which shed $2.65 to close at $18.05 would have been the two main contributors to the decline. Carreras was reacting to the news on a ban on cigarette smoking in public, effective July.

The number of shares traded increased over that of yesterday’s volume of 5.8 million units with a value of $58.9 million. In today’s trading 7.6 million shares traded, but for a lessor amount of $36.7 million as Cable & Wireless which pulled in only $524, 000 accounted for more than 3.78 million of the volume that went through the market.

Junior market | Eight stocks traded in the junior market with 7 increasing in price. Dolphin Cove closed up 20 cents at a 52 weeks high of $8.65 with 6,200 shares. Lasco Manufacturing traded 135,128 shares between $15.50 and $16 but closed at $15.80 up 25 cents. Lasco Distributors traded 823,740 shares while gaining 22 cents to close at $15.77. Lasco Financial Services closed at an all-time closing high after the stock traded at $11.80 up 25 cents while trading 152,327 units. The stock traded as high as $12.50 during the day.

Main Market | Although the overall market enjoyed nearly $36.7 million of trading, $17 million came from the junior market with the two large Lasco companies continuing to be dominant in the market. Carreras was the big loser today and for the week to date, as investors shed 31,000 shares at prices that were all lower than yesterday’s close. Jamaica Producers shed $2.65 but with only 3,200 shares trading. Companies that had noticeable price action included Carreras which lost $1.40 to close at $56.50, Desnoes & Geddes gained back the 20 cents it lost yesterday to close at $5 with small volume trading. Grace also traded a small volume but the stock closed at $60, up 40 cents. Sagicor Life dropped 40 cents, closing at $8.40 with 11,157 units trading. Scotia Group traded 373,951 shares with the stock closing at $21.20 the same as yesterday.

IC bid-offer Indicator | At the end of trading, the IC bid-offer sentiment indicator shows that bids for 3 stocks were higher, with 2 stocks that had an offer that was lower than their last selling price — not a very bullish sign at this time.

JSEIndicesJun26