The Jamaica Stock Exchange is now one the worst performing stock exchanges for 2023 so far.

So remember BC – Before COVID- when the Jamaica Stock Exchange was getting all this praise for being the best-peforming stock index in the world? That actually happened TWICE! 

Well, my how the tables have turned.

According to countryeconomy.com, which is a website that compares social and economic indicators across the world, the JSE now ranks in the bottom five performing stock exchanges this year.

The JSE Main Index closed on June 9 at just over 327,000 points.  That’s down over eight from where it started the year. 

That land’s the JSE in worst performing pile for the year, next to the KSW, Kuwait’s Index, which is down six percent, and ADX Abu Dhabi which is down eight per cent.

So now you’re thinking, ‘what happened’? How did we go from the best to the worst.

As we all know, COVID hit the JSE like a ton of bricks. At the start of the pandemic, a lot of investors pulled their money out of stocks and it was mayhem. And the same thing is happening now but for different reasons. 

With interest rates where they are now, investors have been moving towards other securities that can give them higher and more consistent returns. Also, investor confidence is kinda low right now. Between higher inflation, interest rates, fraud scandals and cyber attacks, people have been very wary about investing. 

And as we always talk about with supply and demand, when the demand is low, prices drop. 

The lower the price, the lower the company’s market capitalization. We talked about market cap, when we discussed how Sagicor dethroned NCB as the largest Jamaican company on the JSE. The more shares a company has and the higher the stock price, the larger its market cap. Lower price and same number of shares means lower market cap. 

Right now some of the largest companies on the JSE are struggling. We mentioned NCB. That stock fell below $70 recently, down 15% for the year.  Sagicor is down almost 15% for the year as well. So all of this adds up. 

An article in the Jamaica Observer recently pointed out that the JSE Main Index only saw $1.7 billion in value traded in May 2023, compared to $4 billion in May 2022. It’s even worse when you compare it to the $8.7 billion from May 2018, which is one of the years the JSE was listed as the best-performing. 

So when you combine all those factors, the JSE has fallen from grace. BUT! One thing about stock markets is that they always recover over time.  Stock market investing is best for the long term.  So I wouldn’t count it out yet. You know the saying “todeh fi yuh, tomorrow fi me”? Yup, that’s how the stock market is.