Issue No. 68

The Trinidad and Tobago (T&T) stock market wrapped up the month of March 2026 with a slightly positive performance. The Trinidad and Tobago Composite Index (TTCOMP) achieved a total return of 0.55% for the period, reflecting steady gains across major market segments. Notably, the Cross-Listed Index (TTCROSS) contributed to this overall result by posting a return of 1.15%. Meanwhile, the All T&T Index (TTALL) also ended the month on a positive note, recording a modest total return of 0.38%.

The main detractors for the month were First Citizens Group Financial Holdings Limited (FCGFH), falling by 8.08%, and L.J. Williams Limited "B" (LJWB), which dropped 6.86%. On the other hand, National Enterprises Limited (NEL) and Trinidad and Tobago NGL Limited (NGL) emerged as the top gainers, posting monthly increases of 49.17% and 45.27%, respectively. Massy Holdings Ltd (MASSY) dominated trading activity on the First Tier Market as the volume leader, followed by Trinidad and Tobago NGL Limited (NGL).

The local stock market was supported by its underlying energy constituents. T&T’s Energy Minister Roodal Moonilal, at a post-Cabinet news conference, announced that the NGL board would be considering a dividend payment of about $308 million to approximately 11,000 shareholders. Additionally, Gerald Ramdeen, Chairman of TTNGL and the National Gas Company of Trinidad and Tobago (NGC), indicated that investors would not only receive dividends again after three years, but may also have the option to request their payments in United States dollars.

In March, the Central Bank of Trinidad and Tobago (CBTT) decided to maintain the repo rate at 3.50%. The Bank observed a softening in the local energy sector and a slowdown in the non-energy sector during the fourth quarter of 2025, with inflation remaining subdued. The Monetary Policy Committee reiterated the presence of significant uncertainty in global economic conditions. Since July 2025, short-term U.S.–Trinidad and Tobago interest rate differentials had consistently narrowed but began to widen again in March 2026 with rising U.S. yields. Over the month, the CBTT yield curve remained largely flat, with increases focused on the 5-to-8-year maturities.

The energy sector's outlook remains positive, with prospects for a tentative rebound starting in 2027. Various energy initiatives within T&T’s waters and cross-border projects, such as Shell's plan to start natural gas production in 2027 from the Loran-Manatee offshore field (which spans Venezuela and Trinidad and Tobago), highlight these opportunities. Against this backdrop, the team continues to approach local equity and fixed income investments with active management, robust fundamental research, and a long-term perspective for unitholders.

March saw a rise in geopolitical tensions, leading to greater market volatility and impacting global bond and equity markets. In the United States (U.S.), equities declined, with the S&P 500 declining 4.98%, with the Energy being the only sector to post gains.

Global equity benchmarks experienced significant declines during March, largely due to the vulnerability of Asian and European economies as net importers of Middle Eastern energy. As a result, the MSCI All Country World Index, a key measure of global equity performance, fell by 7.13% for the month.

U.S. Fixed income markets also weakened with the Bloomberg US Aggregate Bond Index declining 1.76%. Rising yields led to lower returns, driven by inflation concerns linked to elevated energy prices and geopolitical risks. Commodities showed mixed performance: oil prices surged 51.2%, gold decreased by 11.5%, and natural gas remained largely unchanged. Emerging markets underperformed, with South Korea’s KOSPI nearing bear-market territory due to higher oil prices, inflation worries, and uncertainty regarding the impact of new Google technology on memory-chip demand.

Middle East tensions escalate

Military tensions in the Middle East intensified after the United States and Israel launched coordinated strikes against Iran on February 28, with targeted operations continuing throughout March. U.S. officials described these actions as measures to prevent Iran from developing a nuclear weapon and to reduce regional security threats. The strikes focused on military and nuclear-related sites, prompting Iran to respond with missile attacks on Israeli and U.S. positions. This ongoing escalation increased the risk of a broader regional conflict and added uncertainty to global energy markets. Oil prices rose sharply, impacting oil-importing markets, particularly in Asia and Europe, where higher energy costs amplified inflation concerns and pressured equity and bond markets. The sustained rise in oil prices was driven by worries about potential supply disruptions, although the lasting impact will depend on future developments.

Swift Market Volatility

Market volatility arrived quickly and unexpectedly, as it often does. March presented a reality check for investors, with the escalating U.S.-Israel-Iran conflict shaking global markets and causing oil prices to surge. Despite these developments, the broader outlook remains largely unchanged. Corporate earnings in the U.S. have proven resilient amid the turmoil, and the fundamental case—supported by earnings growth, effective deployment of Artificial Intelligence, and expanding market leadership - remains intact.

Scotia Trinidad and Tobago Short-Term Income Fund (TTD)

- Income and Liquidity

- Low