JSE head foresees a year of innovation in 2025

 

The Jamaica Stock Exchange (JSE), the most active trading platform in the Caribbean, marked its 55th anniversary in 2024, noting a period spent serving companies seeking investment for growth and investors looking for profit.

Managing Director of the Jamaica Stock Exchange, Dr. Marlene Street Forrest says she is anticipating in 2025 a year in which there will be more listings on the Exchange, including on the Junior Market.

She is also foreseeing active participation when the Environmental Sustainability linked market which will be created later in the year.

There are above 85 companies, and 120 securities listed on the JSE, with a market capitalisation of over J$2 trillion. the Exchange’s multiple markets, include the Main Market, Junior Market, USD Market, and Bond Market. Listed companies include finance, communications, manufacturing, retail, real estate, tourism and other industries. 

Street Forrest has led JSE since 2002, serving as general manager until 2017, when she was promoted to managing director. The JSE is said to be involved in a recruiting process for a new company head as Street Forrest looks towards retirement.

With her in charge, the Jamaica Stock Exchange was twice rated the best performing stock market in the world in 2015 and 2018. 

However, 2024 was a challenging year. Data from Trading Economics in November indicates that the main stock market index in Jamaica (JSE) decreased 9442 points or 2.90 per cent since the beginning of 2024.

The Bank of Jamaica in its latest Quarterly Monetary Policy Report, released in November 2024, said that for the quarter ended September 30, foreign currency investments yielded higher returns relative to equity investments.

The category yielded a quarterly return of 3.0 per cent, while the quarterly returns on equities was 0.2 per cent for the September 2024 quarter.

At the same time, the average quarterly yield on 30-day private money market instruments decreased to 2.0 per cent for the September 2024 quarter, relative to 2.1 percent for the previous quarter.

The BOJ noted that   on an annualized basis, the performance of the stock market for the year ended September 2024 reflected a marginal improvement as the pace of decline in the indices decelerated.

Street-Forrest expects a turnaround in the new year, 2025. She told Caribbean Money Daily on November 29, “All things being equal, I think the market will rebound towards the third quarter as interest picks up in the market.

“We anticipate the increase in the threshold for stated capital from $500 million to Junior market $750 million and that will increase the number of companies that will come to market to list bringing with it more interest from dormant and new investors.”

The Government of Jamaica has announced plans to increase the capital threshold for companies listed on the Junior Market of the Jamaica Stock Exchange. The threshold will rise from $500 million to $750 million, pending an amendment to the Income Tax Act.

The Junior Market, established in 2009, currently has 48 listed companies, while a few (Lasco Manufacturing and Lasco Distributors included) migrating to the senior market.

 The JSE head is also anticipating participation by companies in the new ESG platform for which planning is advanced. “We introduced the Jamaican Green Social Sustainable and Sustainability Linked Guide in 2024 and the market will be launched in 2025. I believe you will see interest in this market as more investors appreciate the need to provide green financing and the eco system develops.”

She added, “We should see our listed companies having more robust discussions and analysis in their reports and filings on issues relating to ESG, cybersecurity, data protection and sustainability matters.

Next year there will be far greater innovations for the market as companies seek creative ways of funding their business ideas and investors will be receptive.”

Analysts at Morgan Stanley note that there is increasing investment in “companies that can demonstrate how they’d protect against the world’s biggest sustainability issues, such as public health crises, inequality and climate change, which also pose significant business liabilities. “

“In the power and utilities sector,” they add, “companies and equity investors see potential growth stemming from corporate investments in decarbonization, coal reduction and renewable energy.”

Similarly in bond markets, they say, investors are integrating ESG risks into their credit analysis, adding that the issuance of sustainable finance bonds has increased steadily in recent years.

 Street Forrest admits, however, that market performance will depend upon conditions in the wider economy. 

"Many of these will however be dependent on the measures employed to deal with macroeconomic conditions, external pressures and our willingness to move efficiently with vision and purpose.”

The Stock Exchange head has said that the trading platform is now more robust than ever before. In an interview with Business View Caribbean, she noted, “While the markets did not perform as well as in the previous year, the stock exchange continued to be sustainable.

The year was spent bolstering the Exchange’s in areas such as cybersecurity, enterprise risk management (ERM), and data privacy.

The JSE is slated to stage its yearly conference on Investments and the Capital Markets between January 21 to 23, 2025 at the Jamaica Pegasus hotel in Kingston and online. 

The theme is “Safeguarding the Capital Markets; People Opportunities and Progress.”

Caribbean Money Daily

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