Durrant Pate/Contributor

Local stock market gauges are rebounding with most heading north last week, driven primarily by gains in a handful of heavyweight stocks.

Most notably, stocks were Scotia Group Jamaica (SGJ), which surged following the announcement of its proposed privatisation at J$61.50 per share. Additional strength in Carreras and the TransJamaican Highway (TJH) helped lift the market with the Combined Index advancing 1.4%. 

However, the positive headline performance masked underlying weakness across the broader market. Of the 66 securities that traded during the week, 40 declined, 19 advanced and seven closed unchanged, indicating that buying interest remained concentrated rather than broad-based, while, declining stocks outnumbered advancing stocks by more than two-to-one.

Market rebound happening

This suggests that the average listed company did not participate in the market’s rebound. Six of the nine major indices finished higher, led by the Jamaica Stock Exchange Select Index (+2.74%) and the JSE Financial Index (+2.24%). 

The Select Index benefited from gains in Carreras (+8.9%) and TJH (+6.8%), despite the absence of any material company-specific developments. Meanwhile, SGJ’s rally from the June 12 announcement to delist and go private at J$61.50 per share lifted the Financial Index. 

At the time of the announcement, SGJ closed at J$54.21, implying a takeover premium of 13.5%, which likely spurred investor demand. Given the stock’s sizeable weighting within the index, its advance contributed to both the Financial Index and the broader market’s gains. 

The Junior Market Index declined 0.98%, making it the weakest-performing major index for the week and bringing its year-to-date return to -12.4%. The persistent underperformance stands in contrast to gains across several main market indices, highlighting the challenges smaller-cap stocks have faced in attracting investor interest this year. 

Losses in Fosrich (-5.7%) and Indies Pharma Jamaica (- 10.9%) were among the notable drags on performance during the week. Overall, trading activity remained heavily concentrated. Dolla Financial, Kintyre Holdings (JA) and Productive Business Solutions Limited’s USD ordinary shares collectively accounted for 89.2% of total market volume.