Wednesday, November 5, 2008

Global crisis triggers panic selling on TT Stock Exchange

Published: Wednesday November 5, 2008

THE GLOBAL financial instability is creating panic selling by stock market investors in Trinidad and Tobago.

West Indies Stockbrokers Limited (WISE) says the "strong signs of panic selling" is an indication that investors are trying to mitigate risks to their portfolios.

"This has resulted in low investor confidence and lowering of demand for shares," the brokerage said in its outlook on the fourth quarter.

Significant fluctuation

WISE, a subsidiary of RBTT Financial Group, said there has been a significant fluctuation in the value of shares traded over nine months, and that the current conditions represents an oppor-tunity for investors.

"Some of the listed securities remain fundamentally healthy and the decline in the market presents favourable buying opportunities for the medium- to long-term investor," it said.

In its local market summary for the period to September 30, WISE reported that Trinidad's two main indices closed up 8.5 per cent, 1,066 points for the composite; while the All T&T index rose 20.3 per cent to 1,444.

But within the third quarter, the market closed in negative territory: the composite dropped 7.4 per cent or 85 points while the All T&T Index fell 3.9 per cent or 58 points.

The volume of shares traded amounted to just under 106 million units, relative to 88 million in the prior year period, but their value was substantially reduced. Sagicor Financial Corporation and Trinidad Cement Limited and National Commercial Bank of Jamaica were the most heavily traded stocks, respectively.

But it was Readymix (West Indies) Limited that was the most outstanding performer, rising 351 per cent to close at TT$31.60.

Serious downturn

Leading the declines were Prestige Holdings Limited, First-Caribbean International Bank Limited and National Flour Mills Limited.

Transactions in the current nine months were valued at TT$1.64 billion, down from TT$1.7 billion a year ago.

The third-quarter performance was even more indicative of the downturn.

Market activity declined in the three-month period by more than 31 million shares. And the value of those trades, TT$534.8 million, was substantially below the TT$622.8 million in transactions recorded in the prior year period.

The Trinidad Stock Exchange has continued to experience declines, ending the week of October 31 at 921 points for the composite and 1,243 on the All T&T index. Market capitalisation was down by TT$12 billion to TT$83.5 billion.

Source: Jamaica Gleaner

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