• Group of Seven finance chiefs acknowledged gathering threats to the global economy and gave a cautious pledge to provide fiscal support if those dangers materialize.
• After a two-day meeting in Chantilly, France, finance ministers and central bankers declared risks for the global economy remain “tilted to the downside,” even if growth is stabilizing and there should be a moderate pickup next year. That’s a later timeline for improvement than envisioned at the Group of 20 summit in Osaka last month.
• Fiscal policy should be flexible and growth-friendly while rebuilding buffers where needed,” according to a summary of the talks prepared by the French G-7 presidency. “Monetary policy will continue to support economic activity while remaining mindful of financial stability and recognizing that monetary policy alone cannot address all economic challenges.”

(Source: Bloomberg)

• Oil initially rose more than 1% on Thursday after Iran said it had seized a foreign tanker in the Gulf, but prices gradually lost their gains as it emerged that the vessel had only a small cargo and was detained on Sunday for fuel smuggling.
• Prices steadied by 1330 GMT with Brent crude LCOc1 futures up 1 cent at $63.67 a barrel, after hitting a session high of $64.46.
• West Texas Intermediate crude CLc1 futures were down 7 cents at $56.71 after the U.S. benchmark hit a session high of $57.32.
• Iran said the vessel, which it did not identify, was smuggling fuel and had been carrying 1 million liters, or around 6,200 barrels, in the area of Larak Island and had 12 foreign crew 

(Source: Reuters)

• In the most recent financials published for Caribbean Cream Limited (KREMI), the company reported an overall decline in the net profit for the three-month period ended May 31, 2019. Net profit ended the period at $20.62Mn (EPS: $0.05) which was a 62.7% decline from the $55.37Mn (EPS: $0.15) reported in 2018.
• An increase in administrative, selling & distribution expenses and net finance costs, as well as a decline in overall income, were contributors to the deterioration in the net profit. Admin expenses increased to $106.59Mn, 19.6% higher than in 2018 and net finance costs increased to $6.06Mn (or by 79.2%). Revenues also declined to $135.62Mn (-7.8%).
• The stock has fallen 13.9% since the start of the calendar year. KREMI closed yesterday’s trading session at $5.01 and currently trades at a P/E of 41.9x earnings which is below the Junior Market Manufacturing sector average of 28.8x.

 (Source: Caribbean Cream Financials)

• Portland JSX reported a recovery in profit of US$94.79Mn (EPS: 0.03¢) for the three months ended May 31, 2019, relative to the US$ 500.94Mn (EPS: -0.16¢) loss in 2018.
• This improvement in the bottom line was driven mainly by the net fair gains on financial assets classified at fair value which amounted to $276.76Mn up from the $313.18Mn loss reported in 2018.
• The company also reduced operating expenses by 12.5% to $184.68Mn.
• The stock has risen 11.3% since the start of the calendar year, closing yesterday’s trading session at $8.35 per share. At its current price the stock now trades at a P/B of 0.81x which is below the Main Market Real Estate sector average of 1.89x.

(Portland JSX Financials)

• Fitch Solutions expect Antigua and Barbuda’s economic growth will moderate in 2019, as a hurricane recovery-driven construction boom slowly fades.
• That said, growth is expected to remain relatively strong, as activity in the tourism and construction sectors remain robust. Fitch forecasts real GDP growth of 4.4% in 2019 and 3.3% in 2020.
• Over the medium term, a slowing global economy and pressure on the government to rein in spending will provide headwinds to growth.

(Source: Fitch Solutions)

• On July 1, 2019, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Honduras. At the same time, the Board approved two-year arrangements under the Stand-By Arrangement (SBA) and Standby Credit Facility (SCF) for Honduras;
• Macroeconomic conditions in Honduras remained stable in 2018. GDP growth slowed to 3.8% last year due to weaker terms of trade but remained close to potential, supported by private consumption amid strong growth in remittances.
• Inflation is stable around the center of the central bank´s 4±1 percent target band. Owing to lower coffee prices and higher oil prices. The current account widened to 4.3% of GDP but stayed close to its historical average. The financial system is stable, liquid, and well-capitalized, with NPLs at historic lows.
• In this context, while growth is projected to slow down to slightly less than 3.5% in 2019—mainly owing to still weak terms of trade—reforms in the electricity sector, improved governance, and the continued strengthening of the macroeconomic policy framework would secure debt sustainability and support a recovery in investment; and positive confidence effects would foster GDP growth.

 (Source: IMF)

• The perennial problem that is the U.S. debt limit is oozing its way back onto the agenda.
• Treasury Secretary Steven Mnuchin said that under one of the Treasury Department’s scenarios, the country will be at risk of defaulting on payment obligations in early September.
• With Congress due to start its recess on July 26 and not return until mid-September, there is some pressure to agree on a way forward in the coming weeks.
• Mnuchin is in Paris for a meeting of G-7 finance chiefs where the French are busy pushing for agreement on a digital tax on tech giant profits. 

(Source: Bloomberg)

• The pound fell to the lowest since 2017 as the market once again reckoned with no-deal Brexit risk after the contenders to be U.K. prime minister toughened their rhetoric.
• Sterling hit its weakest level in more than two years versus the dollar and a six-month low against the euro, as Brexit negotiations appeared to turn more hostile.
• Both leadership contenders Boris Johnson and Jeremy Hunt have said the so-called backstop plan to avoid a hard border in Ireland, considered essential by Brussels, would need to be scrapped.
• The U.K. currency extended its slide after Sky News reported that Johnson’s team was considering sending lawmakers home for up to two weeks in October to prevent them from blocking a no-deal Brexit.
• After a strong start to the year, the pound is the worst performer in the Group-of-10 in recent months and is at the lowest ever for this time of year.

(Source: Bloomberg)

• Bank of Jamaica intervened in the foreign exchange market yesterday 11 July 2019, with an offer of US$30Mn sold to authorized dealers and large cambios by means of Bank of Jamaica’s Foreign Exchange Intervention and Trading Tool (B-FXITT).
• This intervention is intended to address temporary demand and supply imbalances in the market.

(Source: Bank of Jamaica)

• For the six-month period ended June 30, 2019, Mayberry Jamaican Equities reported a net loss of $39.42Mn, representing a 108.9% decline from the $440.69Mn profit reported for the corresponding quarter of 2018.
• The performance over the period was mainly impacted by a 62.9% decline in operating revenue coupled with a 70.9% increase in operating expenses.  Operating income was severely affected by a significant (87.1%) YoY decline in fair value gains on its investment portfolio as well as a 22.9% YoY compression in dividend income. Net interest income also deteriorated YoY from -$40.67Mn in 2018 to -$72.89Mn in 2019.  
• Operating expenses increased in 2019 to $269.90Mn from $157.89Mn in 2018 due to incentive and management fees for investment management services. This was partially offset by savings in admin expenses.
• The stock has risen 22.3% since the start of the calendar year, closing yesterday’s trading session at $11.32. At this price, MJE is currently trading at a 22.5% discount relative to its June 28, 2019 NAV of $14.60 per share.  

(Source: MJE Financials)