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Issue No. 46
Markets Wrap
Local Equities
In May, the local equity market experienced further volatility, marked by declines in all indices. TT Composite Index stumbled -3.88%, the largest monthly market contraction since May 2023. The TT Cross listed Index lost 4.49% due to the -12.86% and -6.90% dip in JMMB Group Limited (JMMBGL) and NCB Financial Group Limited (NCBFG). The All T&T index slipped -3.71% as Angostura Holdings Limited (AHL) and Guardian Media Limited (GML) delivered double digit declines of -25.29% and -10.50% respectively. Trading activity on the TT Composite Index was derived from 26 securities being traded of which 7 stocks advanced, 17 declined and 2 held firm.
During the month, Trinidad and Tobago NGL Limited (TTNGL) released its quarter 1 results ended March 2024. TTNGL recorded higher total income during period, resulting in a jump in EPS from $0.09 to $0.20 as at March 2024.
The local equity market continues to grapple with heightened price fluctuations due to the overall negative investor sentiment. Investors are reminded that equity investing yields the best results over the long term through its capital growth potential.
International Equities
In May, the S&P 500 recouped its April losses (-4.16%) and posted a month-on-month recovery of 4.80%, fuelled by overall positive Q1 corporate earnings results.At the end of the month, gains were recorded from 10 of the 11 S&P 500 sectors. Information Technology sector led with a 9.95% increase while the energy sector lagged, down 0.97% month on month. The S&P 500 Index closed the month at 5,277.51, after reaching an all time high of 5,321.41. Target prices continue to inch up, as Bloomberg’s 12-month target price for the S&P 500 stands at 5,871.61, an estimated 11.3% growth fuelled by recovery from the energy sector.
Following three consecutive months of disappointing CPI reports, inflation numbers eased slightly in April providing a sigh of relief to investors and signalling that a rate cut is on the horizon. Month on Month, inflation numbers increased 0.3% from March, slightly below its estimate of 0.4%. On a 12-month basis, however, the CPI increased 3.4%, in line with overall expectations. Consumer confidence Index rose to 102 in May, up from the record low of 97 in April.
After peaking in April, oil prices withdrew during May while broader commodities delivered positive results. Crude oil prices retreated 6.03% month-on-month to US $76.99 from US $81.93 per barrel. Natural gas prices recorded the largest gain of 29.9% to $2.587, the highest price since November 2023 while gold prices strengthened marginally, moving from 2,302.90 to 2,322.90 at the end of May. Commodity prices are anticipated to show overall stability in 2024 after years of high volatility.
Index |
YTD ∆ |
1Yr % ∆ |
S&P 500 |
10.42% |
26.01% |
MSCI ACWI |
7.86% |
21.32% |
ALL T&T |
-5.11% |
-10.41% |
T&T Composite |
-6.34% |
-9.67% |
Rates |
Current |
31-Dec-23 |
GORTT 3M |
1.40% |
1.05% |
GORTT 10Yr |
5.29% |
5.19% |
US 3M |
5.40% |
5.33% |
US 10Yr |
4.49% |
3.87% |
Commodities |
Current |
YTD % ∆ |
Oil (WTI) |
$76.99 |
10.58% |
Nat Gas (HH) |
$2.587 |
-0.84% |
Gold |
$2,322.90 |
13.47% |
Local Fixed Income
Along the April GORTT yield curve, shorter term rates rose higher, above pre-Covid levels. The 6-month rate moved from 1.77% to 1.82% (Dec 2019: 1.47%) while the 3-year rate stood at 3.33% (Dec 2019: 3.05%). The largest month on month movement was recorded on the 5-year timeline, which moved from 4.32% to 4.55%. We expect to see continued upward movements in short term rates local as the Central Bank of Trinidad and Tobago focuses its efforts to narrow the short-term interest rate differentials between Trinidad and Tobago and the United States.
The market continues to display a robust demand for fixed income securities, with corporate and government issues gaining healthy traction from the investors. Market liquidity fell 13% to TT$3.9 billion in April as investors participated in the recent Government and Corporate bond facilities in the market.
International Fixed Income
The Bloomberg Global Aggregate index, recovered from its April drawback, climbing 1.31% during May while the US Investment Grade corporate spreads, as measured by the CSI BBB Index, narrowed moving from 1.25% to close at 1.21% in May. US 10-year Treasury yields closed lower during the month, moving from 4.69% on April 30th to 4.51% on May 31st while the 2-year yield stood at 4.89%.
Market Highlights
Trinidad and Tobago’s energy company, National Gas Company (NGC), received a two-year license from the US government to develop the Cocuina-Manakin gas fields with Venezuela. This marks second issue approval by the US for energy projects between the two countries, following a license in 2023 to Shell and NGC for the Dragon gas field in Venezuela.
Investment Buzz
Initial Public Offering (IPO) is when a private company sells its shares to the public for the first time, transitioning to public ownership. This process allows the company to raise capital from public investors.
Fund of the Month
Scotia Global Equity Fund (USD$)
- Equity Investments
- Medium to High Risk
- Capital Appreciation
Historical Returns (May 2024)
6-Month |
1-Year |
5-Year |
13.76% |
21.80% |
9.07% |
Mutual Funds
USD Funds
TTD Funds
Need more information regarding our Investment Solutions?
Speak with one of our investment specialists.
Estelle Narine
777-0487
estelle.narine@scotiabank.com
Candice De Sormeaux
777-0732
candice.desormeaux@scotiabank.com
Adesha Gonzales
486-0581
adesha.gonzales@scotiabank.com
General Disclosures:
This report has been prepared by Scotia Investments Trinidad and Tobago Limited (“SITT”), a subsidiary of Scotiabank Trinidad and Tobago Limited. It is provided to you, our clients, for information purposes only and may not be redistributed. The information herein is believed to be reliable and includes information from public sources also believed to be reliable. While the objective is to provide information in a fair, clear and non-misleading manner, SITT does not represent or warrant that any information in the report is free from errors or omissions. Opinions and projections in this report are the views of the author(s) as at the date of this report.
The views expressed are subject to change and SITT has no obligation to update, modify or amend this report or to otherwise notify a recipient thereof in the event that any opinion forecast or estimate herein changes or subsequently becomes inaccurate. Nothing contained in this report is or should be relied upon as a promise or representation as to the future. Neither SITT nor any of its officers, directors, partners, or employees accepts any liability whatsoever for any direct or consequential loss arising from the use of this report or any of its contents. The securities discussed in this publication may not be suitable for all investors.
This report is provided to you for informational purposes only. It is not an offer or a solicitation of an offer to buy or sell any securities or to participate in any trading strategy. This report is not intended to provide personal investment advice and it does not take into account the specific investment objectives, financial situation or particular needs of any specific person. Investors should seek advice regarding the appropriateness of investing in securities and implementing investment strategies discussed or recommended in this report and should understand that statements regarding future prospects may not be realized. Nothing contained in this report is or should be relied upon as a promise or representation as to the future. The information in this publication is not intended to predict actual results, which may differ substantially from those mentioned in this report. Scotia Investments Trinidad and Tobago Limited, its directors, or other officers may have a position in, or engage in transactions in any of the securities mentioned herein.