All Jamaica just below 350,000 points

The main market of the Jamaica Stock Exchange hit new record high with the all Jamaica composite Index sitting just below the 350,000 points level with 3 hours of trading elapsing.
The All Jamaican Composite Index jumped sharply by 5,035.03 points to 349,774.63 and the JSE Index surged 4,5687.48 points to end at a record 318,684.18 while the Junior Market index jumped 32.26 points to 3,194.15.
Indies Pharma traded 3,185,194 shares up to $2.25 up 75 cents from the IPO price of $1.50 while Everything Fresh climbed to $2.20 following six months results. Subsequently, Indies traded 21.19 million units with the last traded price being $2.24.

JSE PE ratios heading higher

The stock market combined index climbed from 82,934.95 points at the end of 2013 to 324,801.52 on Friday, for increase of 292 percent but the average PE ratio has moved from 7.3 by just under 100 percent to peak at an average of 14.5 times last year December.
During the same period, Treasury bill rates tumbled 75 percent from just over 8 percent to 2 percent or were 300 percent more than they are now. While the fall in interest rate would appear to be close to the rise in the market index, the much slower increase in the PE ratio indicates that the major part of the rise is due to increased profits.
Based on the trends in interest rates and PE ratios, coupled with the serious shortage of supply of several stocks, currently, the PE ratio of the market will rise from the current level of 12.5, first to the high of 14.5 reached at the end of December last year and should move on to around 17 to 18 by the end of the year or early 2019.
A look at the chart, indicates that investors are more cautious in moving stock valuation higher. The PE ratio seems to be moving higher each year since the sharp jump in 2015, suggesting that the increase in PE is not yet over. The other factor is that interest rates have fallen faster in 2018 than for some time, investors seem to need more time to digest the rapid change in rates and determine how long it likely to remain at very low levels.
The big question to come will be, when will interest rates start to reverse? If the PE hits 17 by year end, it would represent an approximate 35 percent increase from current levels. Quite a number of stocks are selling above the average of 12.5 presently. A total of 24 stocks in both markets trade above 12.5 and 7 each in the main market and Junior Market selling above 16 times current year’s earnings.

JSE markets fall in morning session

All Jamaica Stock exchange indices are down in then morning session on Wednesday except the US market that is flat.
At midday, the All Jamaican Composite Index dropped 1,540.15 points to at 343,864.88, the JSE Index fell 1,403.25 points to close at 313,299.72 and the Junior market dived 62.25 points to 3,088.65.
NCB Financial pulled back to $100.05 from Tuesday‘s closing price of $104, trading 29,803 shares, Caribbean Cement traded 7,300 shares up to $43.50 but pulled back to $41. Grace Kennedy traded 9,374 units up to a new high of $58 but pulled back to $57.
In the junior market Access Financial dropped from $46.50 to $36 trading 1,000 shares, Caribbean Producers jumped to a new high of $6.77 with 5.28 million units changing hands and General Accident traded 6,949 shares at a new 52 weeks’ high of $3.86 and now has no stock being offered for sale.

More record for JSE majors

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The main market of the Jamaica Stock Exchange cleared another mile stone after 15 minutes off the market opening on Tuesday with the All Jamaican Composite Index breaking through the 347,000 points mark.
The All Jamaican Composite Index jumped 2,501.62 points to at 347,551.83 and the JSE Index gained 2,279.26 points to close at 316,658.95. The Junior market was flat at 3,130.20 points but Medical Disposables traded at a new record high and headed to $6.68 having posted strong gains in its first quarter profit.
Helping in the record move on the day after the in the main market was closed for the Independence Holiday, is NCB Financial rising to $104 and Grace Kennedy at $57.

Investors shun Junior stocks for the oldsters

Black Panther mash up Palace bottom-line with a huge increase in profit that pushed to stock to no 1 for 2018 in the main market.

Investors shunned Junior Market stocks in 2018 for the older more established Main market stocks. At least that is what the data from the exchange is showing.
According to the Jamaica Stock Exchange report of trading to the end of July, volume and value on the main market is up while that on the junior market is well down on 2017 figures, even as the gains in the overall market shows juniors up 14 percent for the year to the end of July and 9 percent for the main market.
Junior Market volume is down year to July by a stunning 69 percent to 571 million units while the value fell 64 percent to $2.69 billion, less than half of the $6.6 billion traded for all of 2017. In contrast main market stocks traded 1.57 billion units, up 28.5 percent over 2017, for a total value of $32 billion, a strong 79.4 percent increase over 2017 and just shy of the $35.7 million traded for all of 2017.
The big winners for the year to July are, Palace with an increase of 154 percent, that was helped by the huge success of the Black Panther film that ran for several months, Pulse Investments up 67 percent, Kingston Wharves 60 percent, Jamaica Broilers 45 percent and Salada Foods 41 percent, as investors responded to improved profit. In the Junior Market, C2W Music and Derrimon Trading beat all others by huge margins, rising 233 percent after it announced a 10 to 1 stock split and 197 percent respectively. Express Catering climbed 86 percent, Stationery and Office Supplies up 65 percent and CAC 2000 up 51 percent.
The big losers in the main market are, Ciboney, having sold off the property it owned and paid out most of the proceeds as a dividend is down 68 percent, 138 Student Living fell 35 percent, Kingston Properties 31 percent, Wisynco Group 24 percent, Portland JSX 20 percent and in the Junior Market, GWEST Corporation down 36 percent, AMG Packaging 33 percent, tTech 23 percent, Knutsford Express 23 percent and Eppley 17 percent.

JSE trades at record high

The Jamaica Stock Exchange main market, trades at a new intraday high in the morning session on Monday and could be heading for another record close, if prices hold up substantially at the the end of trading.
Just before Mid-day the All Jamaican Composite Index climbed 1,552.05 points to 341,987.04 and the ;JSE Index rose 1,414.10 points to 311,588.81. the new record follows the record reached on last Friday. When the All Jamaican Composite Index climbed a strong 2,697.06 points to 341,378.20 and the JSE Index surged 2,457.33 points to 311,034.08 as NCB Financial jumped over $3 and ended the day at $100.01 following release of the group’s nine months results.
Currently, the Junior Market trades down, 15.08 points to 3,078.02.

All Jamaica nears record 341,000 points

NCB Financial climbed to $99.80 and Jamaica Broilers at a record $30 after just after 11 on Friday morning and pushed the main market to a new record high, surpassing the record reached last week Friday.
At minutes after 11, the All Jamaican Composite Index jumped 2,522.73 points to a record 340,798.92 surpassing the record of 340,315.50 reached last Friday with the JSE Index rising 2,298.49 points to 310,506.28 versus a record 310,065.85 last week. . The Junior Market added 23.66 points to trade at 3,064.01. the main market rose further to 340,893.72 points on the All Jamaican Composite Index and the JSE Index climbed to 310,624.04 at 11:15 am.
Carreras traded 612.643 shares at $9.20 and NCB Financial traded 274,733 units and now trades at $95. In the Junior Market C2W Music traded at a 52 weeks’ high of $1.70.

More records ahead for JSE

The main market of the Jamaica Stock Exchange closed at a record high on first four days last week and shot to a record high during Friday’s trading but failed to hold above the 340,000 points it traded at, but the market is heading much higher.
The chart shows that 340,000 mark, as a resistance point, which may require sometime before it is fully taken out and the market moves higher. The chart is showing a pattern for 2018 that is close to that for 2017. The market having risen in January last year, went sideways with an upwards bias until July and then broke out of the channel went on to a peak in November. For 2018, the market has slowly moved upwards within a narrow channel but could break out as it did in 2018 with a bullishness seen over the past two weeks.
The market is being steered higher by a long term upward sloping support line as well the 45 and 125 day moving averages, lending support just below the index for the main market and the Junior Market is being steered by an upward rising long term support line.

New high for All Jamaica

NCB Financial climbed to $99 seconds after trading opened on Friday while trading just 460 shares and helped to push the main market into record territory.
The All Jamaican Composite Index climbed 1,082.40 points to a record 340,315.50 with the JSE Index rising 986.19 points to a record 310,065.85. in moderate early market activity. The Junior Market added just 6.55 points to trade at 3,061.45 as investors pushed IC TOP 10 listed, Caribbean Cream share up to $6.10, in trading 39,035 shares at the opening, in response to a 59 percent increase in profit for the first quarter. Trading in the stock is suspended, with it having risen 24 percent from the close on Thursday.
If the market ends above Thursday closing level, it would result in five days of new record close for the market.

Mismatched stock values

Jamaica Producers former HQ

At the start of June, investors could pick up PanJam Investment shares at $45 and theoretically sell off the 31.56 percent holdings in Sagicor and own each PanJam share for just $1.
A few weeks on, the proposition is more expensive to achieve as it would cost $8 to achieve the same objective. Based on the lack supply of PanJam shares on the market it could become even more expensive in the weeks and months ahead.
While that anomaly exits, there is the wield situation in the local stock market where prices seem to be mismatched. Jamaica Producers (Producers) is selling a PE around of 25, well above the market average of 13 currently, but below Kingston Wharves (KWH) at 30. Jamaica Producers owns 50 percent of KWH with half of its market value being $33 billion. Producers is valued by the market at $19 billion well below its half of KWH. It would require a 74 percent price gain in Producers to equal the value of their holdings in KWH, assuming the latter remains around the current price of $46.55.

Kingston Wharves trades at 30 times 2018 earnings.

Another fascinating finding is that Junior Market listed Access Financial Services with market capitalization of $12.77 billion is almost twice the size of Mayberry Investments of just $7.8 billion. Mayberry formerly owned over 40 percent of Access before selling it off to Proven Investments.
Mismatching is also evident in the junior market with Cargo Handlers and Knutsford Express selling well above the market for more than a year, even after their prices have slowly declined over that period. Everything Fresh has now joined the group of highly valued stock with PE in excess of 20 times 2018 earnings. With Treasury bill rates just under 2.5 percent and heading lower PE of 20 should now be common place, but when the market is selling well below then it raises some questions about how well investors are pricing stocks. A keen look at these high priced stocks is that with exception of KWH the prices have not gained in over a year and in fact some have fallen while others in the market have recorded strong gains. Some of these stocks seem poised to under perform the market for awhile, until time and increased earnings better align their values with the rest of the market.