JSE Main market showing next major resistance around the 360,000 point level on the al Jamaica Index
The current state of the Jamaican stock market in one of contrast with the main market hitting 5 days of record close and with gains of 40 percent for the year to date and Junior Market that was up 31 percent in May is now up just 14 percent.
With stability present in the forex market for the Jamaican dollar, lower interest rates being paid on money market funds and with business confidence at record high levels, funds are now moving into the main market stocks with less interest being shown in the Junior Market.
Prices in the US dollar market have come off, after the index was up 63 percent at 268.73 points in February, up from 164.50 at the start of the year, but it is only up 12 percent now with the index at 184.86 points at the close of trading on Friday.
Jamaica Main market stocks itching to break out of channel that stretches back to 2014
The Junior Market was driven up by excessive buying that drove a number of the stocks to excessive valuations which the market has been correcting for, resulting in the sharp pull back from the all-time high, even then there are some that are still overvalued based on the average valuation of other stocks. The market still has several undervalued stocks but the focus on the bigger and more liquid main market is sucking some energy from the junior ones.
Based on estimated 2017 earnings, the average PE of the junior and main markets are just over 13 times earnings. The main market has more than half of the market trading below this level. Included in the list are Berger Paints with a PE of just 5, Caribbean Cement at 6, Jamaica Broilers 7, JMMB Group at 8, Grace Kennedy, NCB Financial and Sagicor Group at 10. The market has Jamaica Producers selling at 32 times 2017 earnings and Kingston Wharves at 27 times earnings with Kingston Properties at a rich 36 times and are clearly overvalued currently. Jamaica Stock Exchange and 138 Student Living at 22 are well ahead of the market average.
Junior Market under pressure, testing support around 2,900 points.
In the Junior Market Medical Disposables is priced at 6 times earnings, General Accident 6, Caribbean Producers 7, Stationery and Office Supplies, Caribbean Cream and Main Event at 10. Just under half of Junior Market stocks are trading blow the market average with about 25 percent well above the average.
Technical reading| The main market broke through major resistance for the second time since September at 290,000 points, that has its genesis in 1992 and connecting in 2005. The market faces some short term resistance around 300,000 points which should be broken through before long ahead of moving to the next sort term resistance around 360,000 points with 505,000 on the all Jamaica Index, the next big stop. The market has been trading in a distinct upward sloping channel from mid-2014 until now and seems set to break out and move higher.
The Junior Market chart is a big contrast to that of the main market.
Wigton Wind farm should list on the JSE main market in early 2017 with a large capitalization
While the latter is clearly heading higher with new highs being created, the Junior Market index is flashing negative signals. The market has formed a head and shoulder pattern which is a negative signal and the short term 45 days moving average has broken through both the medium term 200 days moving average and longer term moving averages. The market has broken through the channel that it has been trading in since late 2015. There appear to be support around the 2,900 points level but it could go down to 2,800 points where the next support is and it will left to be seen 2,900 points will be the floor ahead of third quarter results that could change the course of the movement.
With just over 2 months for the year to end investors should start to have an eye open for major factors that could make big differences to earnings in 2018 when making investment assessment now. Some of these are, more reduction in interest rates, continued strong foreign exchange growth, low inflation, increased construction activity, increased activity in the tourism sector and of course the potential for several new listings to come to market between now and then. IC Insider.com is aware of 8 such potential listings. The list include, Wigton Wind Farm, Jamaica Public Service as a result of Government of Jamaica’s planned sale of its 20 percent share in the company, Neveast Stationery, KIW International, a relatively new business in Montego Bay and a large manufacturing business, operating out of St Catherine.
Trading ended with the market sentiments looking mixed for Monday’s trading activity as 3 stocks ended with bids higher than their last selling prices and 2 with lower offers.
trading, Grace Kennedy ended trading 40 cents higher at $43.40, with 61,347 stock units, 
PanJam Investment traded at $44, with 7,913 shares, Radio Jamaica finished 5 cents higher at $1.20, with 31,981 units, Sagicor Group traded 47 cents higher at $35, with 2,916,828 stock units traded. 
Trading on the Junior Market of the Jamaica Stock Exchange was lukewarm with very low volume down 93 percent compared with Wednesday’s trading, and low participation of listed securities on Thursday. 
In contrast, September closed with average of 116,176 units valued at $538,652 for each security traded.
Consolidated Bakeries settled with a loss of 50 cents at $2, with 7,500 stock units. Eppley finished at $12, with 1,914 shares trading, Express Catering concluded trading 30 cents higher at $4.50, with 46,800 units changing hands, Honey Bun closed at $4.50 while trading 9,967 stock units, Jetcon Corporation closed at $4.50 with 13,429 shares. Knutsford Express traded with a loss of 5 cents at $14.75, with 6,215 stock units, Lasco Distributors concluded trading at $6.10, with 50,359 stock units, Lasco Manufacturing traded 9 cents higher at $3.98, with 7,240 units, Main Event ended trading at $5.01, exchanging 15,839 stock units and Stationery and Office ended 5 cents higher at $4.85, with 1,765 units changing hands.
The Main Market of the Jamaica Stock Exchange closed at a new record high 
In the market activity, volume and prices quoted are amounts traded for the day at the last trading price. In the main activity, Cable & Wireless ended trading 1 cent higher at $1, with 640,469 stock units, Caribbean Cement dropped $2.59 to $26.01, with just 400 units, Carreras traded 542,284 shares, to close at $12. Grace Kennedy fell 45 cents to end at $43, with 49,438 shares, Jamaica Broilers traded 49 cents higher at $18.99, with 6,020 stock units. Jamaica Producers settled with a loss of $1 at $15, with 93,586 shares, Jamaica Stock Exchange traded with a loss of 20 cents at $7.60, with 1,739 stock units, JMMB Group closed $2.50 higher at a record close of $25, with 371,074 shares. Kingston Properties traded with a loss of 20 cents at $7.20, with 1,400 stock units, 
Kingston Wharves concluded trading at $31.50, with 4,080 units. 1834 Investments concluded trading at $1.38, with 1,843 shares, PanJam Investment settled $2.15 higher at $44, with 5,905 stock units, Radio Jamaica settled at $1.15, with 2,500 shares, Sagicor Group settled 3 cents higher at $34.53, with 23,475 stock units, Sagicor Real Estate Fund ended at $13.08, with 300 units changing hands. Salada Foods finished at $8.50, with 10,000 stock units, Scotia Group ended trading $1.98 higher at $50.98, with 185,115 stock units, Seprod traded $1.95 higher at $30, with 13,026 shares and Supreme Ventures ended with a loss of $1 at $11, with 1,783,545 shares.
Trading on the Main Market of the Jamaica Stock Exchange closed at a new record closing high on Thursday the fourth consecutive record close as the 
Trading ended on the Jamaica Stock Exchange on Wednesday with just 23 securities trading leading to the prices of 9 advancing and 11 declining as the market finished at a record closing high. 
Barita Investments ended trading with a loss of 24 cents at $7.76, with 2,150 units changing hands, Berger Paints lost 45 cents at $11.25, with 77,437 shares, Cable & Wireless ended with a loss of 6 cents at $0.99, with 2,312,610 stocks units trading, Caribbean Cement finished 60 cents higher at $28.60, with 3,500 units, Carreras finished with a loss of 60 cents at $12, with 787,049 shares trading. Grace Kennedy closed at $43.45, with 6,516 shares, Jamaica Broilers ended with a loss of 30 cents at $18.50, with 35,182 units, Jamaica Producers gained 95 cents to end at $16, with 14,581 shares, Jamaica Stock Exchange finished with a loss of 19 cents at $7.80, with 5,832 stock units, JMMB Group ended trading with a loss of 20 cents at $22.50, with 264,042 stock units changing hands, Kingston Wharves ended trading at $31.50, with just 100 stock units, 
Mayberry Investments finished 89 cents higher at $4.99, with 209,716 shares, 138 Student Living ended 60 cents higher at $5.40, with 10,000 stock units, PanJam Investment traded with a loss of $1.20 at $41.85, with 7,370 units, Pulse Investments closed 17 cents higher at $1.82, with 26,600 shares trading. Radio Jamaica closed 4 cents higher at $1.15, with 77,200 stock units, Sagicor Group ended with a loss of 3 cents at $34.50, trading 24,279 stock units, Scotia Group closed at $49, trading 4,559 units, Seprod ended with a loss of $1.95 at $28.05, with 1,594 shares. Sterling Investments finished 20 cents higher at $12.25, with 2,486 stock units, Supreme Ventures ended trading $1 higher at $12, with 319,536 shares and in the main market preference segment, JMMB Group settled with a loss of 4 cents at $1.15, with 9,853 units changing hands.
The JSE All Jamaican Composite Index climbed to a record close at 295,094.91 after holding on to gains of 929.05 points and the JSE Index advanced by 846.47 points to a new closing high of 268,864.84 on Wednesday as 23 securities changing hands.
Trading ended with the market sentiments looking slightly positive for Thursday trading activity as 6 stocks ended with bids higher than their last selling prices and 1 with a lower offer.
Honey Bun concluded trading at $4.50, with 26,385 units, Jamaican Teas lost 1 cent at $3.78, with 3,892 shares, Jetcon Corporation ended at $4.50, with 142,850 stock units trading. Knutsford Express closed with a loss of 9 cents at $14.80, with just 1,448 units, Lasco Distributors concluded trading with a loss of 15 cents at $6.10, with 35,721 shares, Lasco Financial added 3 cents to move to $4.18, with 278,455 units trading. Lasco Manufacturing closed with a loss of 31 cents at $3.89, with 4,344 stock units, Main Event finished with a loss of 9 cents at $5.01, with 5,094 stocks units, Medical Disposables rose 70 cents in concluding trading at $5.30, with 2,100 units, Stationery and Office settled 5 cents higher at $4.80, with 60,000 stock units, Sweet River finished 34 cents higher at $3.86, with 1,553 units and in the junior market preference segment, Eppley ended at $6.55, with 2,300 units trading.