Russia Hikes Rates By 6.5% To Stem Capital Flight

5:00 PM December 15 – Caribbean markets traded higher and the continued oil price decline wreaked havoc in Asian and European markets. Russia was forced to increase interest rates higher by 6.5% at midnight, hoping to curb capital flight.

In Jamaica trading, The JSE Market Index climbed 611.01 or 0.8% to 75,923.15 and The JSE Select Index increased 16.32 or 0.7% to 2,222.53.

Trinidad Composite Index rose 1.11 or 0.3% to 1,142.76 and Bahamas Stock Exchange Index fell 0.12 to 1,640.55.

Of the 12 stocks traded on Jamaica Stock Exchange, 6 increased, 3 decreased and 3 were unchanged.

Jamaican dollar traded near record low and average buy rate against the U.S. dollar was 113.65 and average sell rate was 114.29 according to the website of Bank of Jamaica.

In Kingston trading today, 1.80 million units changed hands worth J$28.83 million and Scotia Group Jamaica led the most active list with 1.06 million units followed by LIME with 453,837 units.

Scotia Group Jamaica jumped 49 to J$20.50 cents and traded 1,060,362 and Kingston Properties Limited climbed J$1.98 to J$5.98 and traded 106,000. GraceKennedy Ltd. advanced 16 cents to J$63 and traded 90,314.

LIME slid 1 cent to 49 cents and traded 453,837 and Sagicor Group Jamaica Limited decreased 3 cents to J$9.96 and traded 6,000. National Commercial Bank of Jamaica Ltd. fell 2 to J$18.32 and traded 4,742.

Trinidad Market Overview

Trinidad Composite Index rose 1.11 or 0.3% to 1,142.76 and of the 13 stocks traded 4 advanced, 4 declined and 5 closed unchanged.

Guardian Holdings Limited led the most active list and rose 1 cent to TT$13.26 and traded 42,132 followed by First Citizens Bank Limited jumped 14 cents to TT$37 and traded 15,972 and ScotiaBank Trinidad & Tobago Limited gained 48 cents to TT$60.48 and traded 6,794.

Jamaica Money Market Brokers Limited dropped 3 cents to 41 cents and traded 214,275 and One Caribbean Media Limited slid 1 cent to TT$25.09 and traded 5,152 and Republic Bank Limited added 1 cent to TT$119.79 and traded 5,000.

World Market Review

Stocks traded lackluster in New York and Europe after oil price weakness extended to the sixth day in a row.

Russian ruble plunged 13% and dropped to a record low of 66 against one dollar sparking capital flight of $125 billion. Market indexes across Europe dropped more than 2%.

Stocks in New York and Europe traded mixed and weaker oil prices hovered trading sentiment.

Energy and resource companies led the decliners after crude oil futures declined for the sixth day in a row and extended yearly loss to 46%. Crude oil futures of immediate month delivery declined 15% in the last six-days of trading.

Russian ruble tumbled 13.1% to 66.01 against one dollar in international trading and yield of 10-year Russian government bond increased 23 basis points to 13.23%.

Russia ruble is entering a dangerous spiral that can force the central bank and Russian government to cut more imports, restrict travel and stoke higher inflation.

In the U.S. earnings news, Apache agreed to sell its stake in its two LNG projects to Woodside Petroleum for $2.8 billion. Emerson Electric agreed to sell power transmission unit for $1.4 billion.

PetSmart agreed to be acquired by a consortium for $8.7 billion. Thoma Bravo plans to acquire Riverbed for $3.6 billion.

Apache Corporation (APA) the oil, and gas producer agreed to sell its stake in its two LNG projects, Wheatstone LNG and Kitimat LNG to Australia-based Woodside Petroleum Limited for about $2.75 billion.

The transaction is expected to close in the first-quarter of 2015.

Emerson Electric Co (EMR), the diversified technology company agreed to sell-off its power transmission unit for $1.44 billion to electric motors maker Regal Beloit Corp.

The transaction is expected to close in the first-quarter of next year.

PetSmart, Inc (PETM), the pet products retailer entered into a definitive agreement to be acquired by a consortium led by BC Partners, Inc. at a price of $83 per share in cash, represented a premium of 39% or for $8.7 billion.

The transaction is expected to close in the first-half of 2015.

Thoma Bravo LLC, the private equity firm and Canada-based Teachers”””” Pension Plan plans to acquire Riverbed Technology Inc, the network equipment maker in a deal valued at about $3.6 billion.

Under the terms, stockholders of Riverbed will receive $21 per share in cash.

In London trading, FTSE 100 index edged down 0.73 to 6,299.90 and in Frankfurt the DAX index rose 0.2% or 23.54 to 9,618.27.

In Paris, CAC 40 index rose 1.19 to 4,110.12.

In European corporate news, Carpetright pre-tax profit surged on 3% increase in revenues. Danske Bank estimated goodwill impairments of about 9 billion kronor.

Johnson Matthey agreed to sell its gold and silver refining business to Japan-based Asahi Holdings for £118 million. Technip abandon plans to acquire rival CGG.

Danske Bank A/S, the Denmark-based bank estimated goodwill impairments of about 9 billion kronor in annual report of 2014 and affirmed its net profit guidance for the year between 11.5 billion kronor and 13.5 billion kronor excluding the of goodwill impairments.

Johnson Matthey Plc, the specialty chemicals maker agreed to sell its gold and silver refining business to Japan-based Asahi Holdings Inc for £118 million or $186 million in cash.

Technip SA, the France-based engineering and construction service provider abandon plans to acquire rival CGG SA, seismic services provider for about €1.46 billion or $1.83 billion in cash.

The offer of €8.30 per share represented a 27% premium over CGG”s closing price on November 19.

Shares of CGG SA tumbled 30.6% to €4.79.

Separately, today the company signed an agreement with Air Liquide Global E&C; Solutions Germany to acquire Zimmer polymer technology business.

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