• Oil futures clawed back some of the losses they sustained in the previous session, but a rebound in COVID-19 cases in some countries undermined hopes for a steady recovery in global demand.
• Brent crude LCOc1 was up 20 cents, or 0.5%, at $39.98 a barrel after dropping more than 5% on Tuesday to fall below $40 a barrel for the first time since June. U.S. crude CLc1 was up 42 cents, or 1.1%, at $37.18 a barrel, having fallen nearly 8% in the previous session.
• “Short-term oil market fundamentals look soft: the demand recovery is fragile, inventories and spare capacity are high, and refining margins are low,” Morgan Stanley said.
• Yet, the bank raised its Brent price forecast slightly higher to $50 a barrel for the second half of 2021 with the dollar weakening and rising inflation expectations, it said.

(Source: Reuters)

• Sygnus Credit Investments Limited’s (SCI) audited net profit for the financial year ended June 30, 2020, declined by 3.8% (or US$0.78Mn) year over year to US$1.97Mn (EPS: US0.56¢).
• The drop in the Group’s bottom-line was primarily driven by a 100.9% (or US$1.32Mn) increase in expenses, which outweighed the 36.3% (or US$1.22Mn) growth in total income. Further, the rise in expenses was largely influenced by a 374.6% (or US$0.82Mn) expansion in net foreign exchange losses and a 42.3% (or US$0.30Mn) increase in management fees.
• Although SCI had record origination of private credit investments across the Caribbean region, the results were adversely impacted by the one-off conversion of J$1.20Bn to USD. This J$1.2Bn was a combination of part proceeds of new JMD debt that was raised, and part proceeds of JMD investments that were exited during the third quarter.
• The results were also impacted by the one-off unscheduled investment exit of US$10.30Mn during the third quarter, sparked by the onset of COVID-19.
• The company’s stock price has declined by 40.8% since the start of the year, closing Thursday’s trading session at $15.39. At this price, the stock currently trades at a P/E of 19.9x earnings, which is above the Main Market Financial Sector Average of 17.0x.

(Source: SCI Financials)

• Fitch Solutions believes Mexico’s political environment faces a difficult decade owing to high levels of income inequality, endemic corruption and a weak security situation.
• The country’s ability to recover from the Covid-19 pandemic and to improve living standards will be crucial to avoiding social unrest in the years ahead.
• In addition, the policy direction pursued by nationalist-populist President Andrés Manuel López Obrador (AMLO), whose term runs through 2024, will play a large role in determining Mexico's progress on improving its political risk.

(Source: Fitch Solutions)

• Industry experts have stated that the resumption of the arrival of cruise ships in Costa Rica is uncertain as the market has just commenced reactivation and is currently testing its health protocols against Covid-19.
• Shipping companies like Aqua Expeditions will return to the Amazon this month and Windstar Cruises is expected to sail to the Caribbean in the fall. Princess would return in mid-December, but giants like Carnival and Holland are going through financial problems that will hinder their immediate return.
• According to the Costa Rican Chamber of Tourism, the Costa Rican Association of the Cruise Industry and the Association of Travel Agencies, the resumption of tourist arrivals via cruise ship could be between November 2020 and January 2021. The most optimistic forecast relates to Royal Caribbean’s return to sea in November, however, there is no certainty that Costa Rica will be among its first routes.

(Source: The Costa Rica News)

• Nonfarm payrolls increased by 1.37 million in August and the unemployment rate tumbled to 8.4% as the U.S. economy continued to climb its way out of the pandemic downturn.
• The unemployment rate was by far the lowest since the coronavirus shut down in March, according to Labour Department figures released Friday. An alternative measure that includes discouraged workers and those holding part-time jobs for economic reasons also fell to 14.2% from 16.5% in July and 22.8% at the peak in April.
• Economists surveyed by Dow Jones had been expecting growth of 1.32 million and the jobless rate to decline to 9.8% from 10.2% in July.

(Source: CNBC)

• President Xi Jinping said nothing will come between the Chinese people and the Communist Party, setting a combative tone at a difficult moment in U.S.-China relations.
• Speaking at an event marking the anniversary of China’s victory over Japan in the Second World War, Xi outlined areas where China will “never” accept foreign interference. He took aim in particular at threats to the Chinese Communist Party’s (CCP) continued one-party rule.
• “The Chinese people will never allow any individual or any force to separate the CCP and Chinese people, and to pit them against each other,” Xi said.
• “The Chinese people will never allow any individual or any force to distort the CCP’s history, and to vilify the CCP’s character and purpose.” Xi did not specifically mention the U.S., but his comments are likely to be interpreted as a message about the relationship.

(Source: Bloomberg)

• Losses deepened at Caribbean Producers (Jamaica) Limited’s for the financial year ended June 30, 2020. The company’s audited net loss increased by 248.0% (or US$2.90Mn) year over year to US$4.07Mn (EPS: -US0.37¢). 
• Lower revenues and higher expenses drove the deterioration in the company’s performance. There was a 16.3% (or US$17.92Mn) drop in revenues, a 43.3% (or US$0.73Mn) increase in finance costs, and 75.8% (or US$1.87Mn) rise in depreciation and amortization expenses. However, the overall impact on the bottom-line was moderated by lower direct costs (-14.9%) and administrative expenses (-15.7%).
• As one of the largest suppliers of food and beverage to the Hospitality sector, CPJ was severely impacted by the near cession of activities in the tourism and hospitality sector due to the global pandemic. Group sales plummeted beginning in March 2020 and continued to be adversely affected until the end of the fiscal year June 2020, typically the Group’s most profitable period.
• The slowdown in the sales activity due to the ongoing pandemic has however assisted the company in smooth implementation of new IT initiatives to improve growth prospects and achieve operational efficiencies.
• The company’s stock price has declined by 55.4% since the start of the year, closing Wednesday’s trading session at $2.32. At this price, the stock currently trades at a P/B of 1.0x, which is below the Junior Market Distribution Sector Average of 2.9x.

(Source: CPJ Financials)

• Barbados’ current account deficit will widen significantly to 6.3% of GDP in 2020, from 2.2% in 2019, due to a collapse in service sector exports.
• Fitch Solutions expects that a halt in tourism activity from March to July, amid the global spread of Covid-19, will severely undermine Barbados’ large service trade surplus and substantially increasing its current account deficit.
• A sizeable fall in goods exports will also lead to a widening of Barbados’ goods trade deficit, compounding the narrowing of the services trade surplus.
• Moreover, the agency expects the continued spread of Covid-19 and weak rebounds in key source tourism markets will keep Barbados’ current account deficit sizeable in 2021 at 4.7% of GDP.

(Source: Fitch Solutions)

• On August 31, Colombia’s Banco de la República (BanRep) lowered its policy interest rate by 25 basis points (bps) to 2.00%, a new record low.
• The bank’s unanimous decision to cut the rate in August brings its cumulative rate-cutting cycle to 225 bps (coming from 4.25% in January, as BanRep has shifted to a more expansionary stance to mitigate the economic shock of Covid-19.
• Fitch expects BanRep to pause its easing cycle, keeping its policy rate at 2.00% through end-2020, as it evaluates Colombia's economic recovery in the coming months.
• As of September 1, the government lifted a vast majority of public health restrictions as Covid-19 cases have appeared to plateau, which will ease the biggest headwinds to growth

(Source: Fitch Solutions)

• Bank of England Deputy Governor Dave Ramsden and another interest-rate setter, Gertjan Vlieghe, warned on Wednesday of risks that Britain’s economy could suffer more damage than spelled out by the central bank last month.
• Ramsden told lawmakers that the BoE had estimated the level of Britain’s economic output would permanently be about 1.5 percentage points lower than it would have been without the pandemic. However, given all the risks, he now believes that the number will be greater than 1.5%.
• Vlieghe said there was “a material risk” that it could take several years for Britain’s economy to return to full capacity after its coronavirus shock.

(Source: Reuters)