THE NEGATIVE impact of the Bank of Jamaica's (BoJ) increase in interest rate continued to affect the local stock market for the second day yesterday, resulting in 18 of 23 stocks declining in value.
Analysts have attributed the movement to market jitters, which followed the BoJ's introduction of a special five-month reverse repurchase instrument at interest rate of 30 per cent, ostensibly to prevent the rapid depreciation in the value of the Jamaican dollar.
The first shock to the equities market was manifested on Monday when the Jamaica Stock Exchange (JSE) index fell by 1,338 points to close at 44,907.37, effectively reversing last Friday's almost all time high of 46,245.38 points.
In yesterday's trading, the JSE index advanced by 903.07 points to close at 45,810.44 points, with market volume totalling just over 6.3 million units, valued at more than $32.2 million.
But the All Jamaica Composite Index declined by 1,360.11 points to close at 45,595.16 points, and the Jamaica Select Index declined by 38.11 points to close at 1,416.11 points.
The biggest losers yesterday were the Carreras Group, which declined by $4 to close at $33, and Jamaica Producers Group, which went down by $2 to $$20.01. Other stocks declining were Berger Paints; Cable & Wireless Jamaica; Caribbean Cement Company; Courts Jamaica; Dehring Bunting & Golding (DB&G); Desnoes & Geddes; Gleaner Company; Goodyear Jamaica; Grace, Kennedy & Company; Jamaica Broilers; Jamaica Money Market Brokers (JMMB); Life of Jamaica; National Commercial Bank (NCB); Pan Jam; Radio Jamaica, and Seprod.
The Bank of Nova Scotia (BNS) advanced by $1 to close at $15, while First Caribbean International Bank advanced by $7.50 to close at $57.50. Ciboney Group, Dyoll and Kingston Wharves traded firm at 14 cents, $7.50 and $2.50 respectively.
The BoJ introduced the special measure in what it said was a context of significant Jamaica dollar liquidity and protracted instability in the foreign exchange market.
