Jamaica Stock Market Weekly Brief (Week 19)

Equity Markets: Broad Indices Rebound, but Market Breadth Weakens

Jamaican equities posted modest index gains this week, but participation remained shallow and selective. The USD Equities Index surged +12.7% to close at 247.02, supported almost entirely by flows into TransJamaican Highway USD (TJH), which dominated trading volume (1.13M units, or 78% of total USD turnover). This single-name skew masked otherwise soft market internals, with only 3 of 16 USD-listed securities advancing, and 11 declining.

In JMD equities:

• The Main Market Index rose +0.18% (+578.46 pts) to 322,938.95, driven by buying interest in larger-cap names like Berger Paints (+7.1%) and JMMB 7.5% Pref Shares (+3.2%), though activity was highly concentrated.
  

• The Junior Market Index added +0.71% to close at 3,457.23, though the weekly net move was -0.20%, with 29 decliners outweighing 16 advancers. Top gainers included EduFocal (LEARN, +4.0%) and Dolphin Cove (DCOVE, +21.6%).
  

• All Jamaican Index ticked up just +0.06%, reflecting the general fatigue in domestic large-cap names outside the financial sector.
  

Notable Equity Observations

Indies Pharma, typically viewed as a defensive name in the Jamaican equity space, posted a muted performance this week, slipping 1.1% despite broader market gains, suggesting a lack of retail participation or conviction at current levels. Meanwhile, several names with historically modest float and retail appeal, CAC 2000 (CAC), and Sterling Investments (SIL), ranked among the worst performers, each falling between 10% and 15%. These drawdowns appear more reflective of illiquidity and stale bids than of any fundamental deterioration. Trading activity remains narrowly concentrated, with volume heavily skewed toward a few liquid tickers such as TransJamaican Highway (TJH), Derrimon Trading (DTL), and Caribbean Cream (KREMI). The clustering of volume in these names highlights the persistent lack of sector rotation and signals that breadth remains weak across both the Main and Junior markets.

USD Corporate Bond Market: Pricing Flat, But Coupons Attractive

Despite favorable index performance in USD equities, secondary bond activity remains stagnant. The majority of USD and JMD corporate bonds traded flat with zero volume, underscoring the HTM mindset that dominates the local institutional investor base.

Top Line Pricing Summary

Bond	Coupon	Maturity	Last Price	YTD Return
ECL 8.5% Mar 2027 (USD)	8.50%	Mar 2027	$99.49	-0.79%
VMIL 9.75% Jun 2026 (USD)	9.75%	Jun 2026	$100.00	0.00%
VMIL 10% FR Dec 2026 (USD)	10.00%	Dec 2026	$100.00	0.00%
VMIL 10.5% VR Dec 2027 (USD)	10.50% (VR)	Dec 2027	$100.00	0.00%
MJE 9.25% Jul 2025 (USD)	9.25%	Jul 2025	$98.73	-3.34%
MJE 10% Aug 2026 (USD)	10.00%	Aug 2026	$100.08	-2.20%
MJE 10.5% Jun 2027 (USD)	10.50%	Jun 2027	$99.00	-1.49%
MIL 10.75% Mar 2026 (JMD)	10.75%	Mar 2026	$100.00	-0.50%
MIL 12% Jan 2026 (JMD)	12.00%	Jan 2026	$100.00	-2.63%

Notable Bond Observations

The MIL 10.75% Mar 2026 bond continues to look underappreciated by the market. It’s flat year-to-date but offers a compelling 10.75% fixed coupon, moderate trading volume (5,000+ units this week), and a clean, near-term maturity profile, making it a superior option to less liquid peers like MJE 10% and VMIL 10%, which remain largely inactive. On the shorter end of the curve, MJE 9.25% due July 2025 is now yielding over 9.5% on just 14 months to maturity, making it an attractive roll-down candidate for accounts willing to tolerate some liquidity risk. Meanwhile, ECL’s 8.5% 2027 bond is holding firm at $99.49, effectively offering a 2.5% capital buffer with relatively low credit risk. While the structure remains sound, investors should closely monitor Q2 earnings to confirm coupon coverage, especially given the bond’s duration.

Positioning Outlook: Trade the Edges, Stay Liquid

We’re still operating in a structurally short volatility market, where most real-money accounts are overweight high-coupon carry, underweight equity beta. We think the next catalyst comes from either:

1. BOJ rate signal or

2. Fiscal reform tailwind (e.g., NHF or GOJ issuance change)

Until a clear catalyst emerges, alpha remains highly name-specific. Our desk is prioritizing opportunities with less than two years to maturity, focusing on USD denominated instruments that offer currency stability and cleaner pricing dynamics. We’re also screening for names with consistent earnings momentum and reliable dividend coverage, which offer both downside protection and optionality in what continues to be a fragmented and illiquid market.

Trade Ideas for the Week

Asset	Side	Rationale
MIL 10.75% 2026	Long	Best carry-adjusted return with live volume
PBS USD Equity	Accumulate	FX hedge, margin expansion, volume rising
TJH USD	Hold	Liquid, sovereign-linked, high retail demand
MJE 9.25% 2025	Buy dip	Short duration + YTM >9.5% = roll-down alpha
Sterling USD	Watchlist	NAV gap closing could spark fast reversal