Monday, February 19, 2018

Quarterly review of the regional markets

Today we at Bourse will provide a recap of the local and regional equity market for the three-months ending 31st March 2014 (the period) and take a look at what’s on the horizon for the local stock market.

In 2013, investors were afforded new opportunities from the listing of the CLICO Investment Fund (CIF) and First Citizens Bank (FIRST) on the Trinidad and Tobago Stock Exchange. At the end of the first quarter 2014 (Q12014), investors continued to show their penchant for the high dividend yielding stocks over the low interest rate instruments as the opportunity for capital appreciation was viewed as being limited to a handful of stocks on the local market.

The local equity market’s performance, although generating modestly negative returns year-to-date (YTD), continued to fare better than most of its peers in Q12014. Both the T&T Composite Index (TTCI) and the All Trinidad and Tobago Index started the year on a downward trend, closing off Q12014 with a return of —1.16 per cent and -0.33 per cent respectively. In USD equivalents both indices decreased by 1.07 per cent and 0.22 per cent respectively (Exhibit 1).

T&T equity review

Trading activity

On the Trinidad and Tobago Stock Exchange (TTSE), the overall volume of shares traded on the total market was 39.6M, with a total value of TT$399.2M.

Ordinary shares

For the first quarter of this financial year, a volume of 36.4M shares crossed the floor. This represents a 120 per cent increase in traded volume when compared to the 16.5M shares that traded in the comparative period last year. The value of shares traded increased 32 per cent to TT$327.8M, as illustrated in (Exhibit 2).

Mutual fund shares

For Q12014, CIF had a volume of 3.2M shares crossing the floor, with a total value of $71.3M. CIF closed Q12014 at a price of $21.85, 0.63 per cent lower than its opening price of $21.99. CIF was the overall market value leader, comprising 17.86 per cent of total market value of shares traded and 8.8 per cent of total volume of shares traded, second only to National Commercial Bank Jamaica Limited (NCBJ).

Volume leaders (ordinary shares)

Taking the top spot in volume leaders was NCBJ, accounting for 58.1 per cent of traded volume with 21.1M shares crossing the board. Jamaica Money Market Brokers (JMMB) followed, registering a volume of 2.6M or 7.3 per cent of the total volume traded. Trinidad Cement Ltd (TCL) followed with a volume of 1.8M or 4.98 per cent, and FIRST came in fourth registering a volume of 1.68M or 4.6 per cent. The fifth spot of the top five volume leaders was held by Point Lisas Industrial Port Development Corporation Limited (PLD) with a volume of 1.67M.

Value leaders (ordinary shares)

As it relates to the value of transactions, FIRST led the board with TT$68.2M in value traded, followed by The West Indian Tobacco Company Limited (WITCO) with TT$53M. Republic Bank Limited (RBL) took the third place with TT$41.6M while Scotiabank Trinidad and Tobago Limited (SBTT) and NML followed with TT$38M and TT$36.3M respectively.

Stocks advancing

Declines outpaced advances for the period. Of the 29 ordinary shares listed on the first tier there were 12 advances, 15 declines and two unchanged. The top five advances and declines can be seen in Tables 2 and 3.

Leading the advances for the quarter was LJ Williams B (LJWB) which gained 38.46 per cent. The total number of shares that crossed the floor for LJWB was 14,650 with a total value of $12,755 which speaks to the illiquidity of the stock. Following LJWB was National Flour Mills Ltd (NFM) which advanced 32.63 per cent. NML appreciated 10.5 per cent, while JMMB gained 9.80 per cent, and One Caribbean Media Limited (OCM) increased 8.11 per cent.

Stocks declining

Of the top five stocks declining, four were Trinidad and Tobago companies, while one was from Barbados. The Trinidad and Tobago stocks took the top three declines, with the biggest decline seen in Flavorite Foods Limited (FFL) which slipped 14.7 per cent. FIRST and Angostura Holdings Limited (AHL) declined 13.1 per cent and 11.8 per cent respectively.

Market developments and outlook

On February 4th 2014, BCB Holdings confirmed that the company’s shares were delisted from the Trinidad and Tobago Stock Exchange, after being listed since Q4 2009.

Although the Trinidad and Tobago Stock Exchange has had a slow start to the year, the softer market may present some buying opportunities. In particular, investors who may have missed more attractive entry points into stocks viewed as expensive at the beginning of the year can now afford to position themselves at more reasonable valuations.

The impending IPO of Phoenix Park Gas Processors Limited would offer local investors a much anticipated opportunity for expected capital appreciation and diversification. The expected timing of the IPO remains in Q2 2014.

Regional Markets

Jamaican equity market

Shifting focus to Jamaica, the country’s benchmark equity index (the JSE Market Index) which comprises all ordinary companies on the Jamaica Stock Exchange ended the period down 8.06 per cent.

On the Jamaican Stock Exchange (JSE) declines slightly outpaced advances. Of the 35 stocks listed on the first tier, there were 15 advances, 16 declines and four remained unchanged. The best performer in the Jamaican market was LIME which advanced 168 per cent from JMD0.16 to JMD0.23 while Hardware and Lumber followed increasing 63.9 per cent, from JMD6.10 to JMD10.00. Ciboney Group Limited experienced a 40 per cent increase, moving from JMD0.05 to JMD0.07 at the end of Q1 2014.

On the other hand, the worst performer was Supreme Ventures Limited declining 24.46 per cent from JMD2.78 to JMD2.10. This was followed by Pulse Investments ( 12.64 per cent) and Kingston Properties Limited ( 11.1 per cent), moving from JMD0.87 to JMD0.76 and JMD4.50 to JMD4.00 respectively.

Barbados equity market

The Barbados equity market saw heavy declines for Q12014, as the BSE Composite Index and the BSE Local Index was down 9.66 per cent and 14.25 per cent respectively.

On the Barbados Stock Exchange (BSE) the number of declines outpaced advances. Of the 26 listed companies there were four advances, six declines and 16 unchanged. In the advancers, Fortress Caribbean Property Fund-Dev climbed 81.8 per cent, from BDS0.11 to BDS0.20 while One Caribbean Media Limited (OCM) went up 27.7 per cent advancing by BDS1.33 to BDS6.13. Fortress Caribbean Property Fund- Value Fund came in third place increasing 17.5 per cent up by BDS0.07 to end the period BDS0.40.

Barbados Dairy Industry suffered the largest decline dropping 50 per cent from BDS3.00. First Caribbean International Bank Limited (FCIB) went from BSD2.98 to BDS2.40 ( 19.5 per cent) while Cable and Wireless Barbados Limited fell 11.8 per cent from BDS3.40 to BDS3.00.

This document has been prepared by Bourse Securities Limited, (“Bourse”), for information purposes only. Any trade in securities recommended herein is done subject to the fact that Bourse, its subsidiaries and/or affiliates have or may have specific or potential conflicts of interest in respect of the security or the issuer of the security, including those arising from (i) trading or dealing in certain securities and acting as an investment advisor; (ii) holding of securities of the issuer as beneficial owner; (iii) having benefitted, benefitting or to benefit from compensation arrangements; (iv) acting as underwriter in any distribution of securities of the issuer in the three years immediately preceding this document; or (v) having direct or indirect financial or other interest in the security or the issuer of the security. Investors are advised accordingly. Neither Bourse nor any of its subsidiaries, affiliates directors, officers, employees, representatives or agents, accepts any liability whatsoever for any direct, indirect or consequential losses arising from the use of this document or its contents or reliance on the information contained herein. Bourse does not guarantee the accuracy or completeness of the information in this document, which may have been obtained from or is based upon trade and statistical services or other third party sources. The information in this document is not intended to predict actual results and no assurances are given with respect thereto.