Investors made tripledigit returns on six stocks over the first half of 2015 led by the Jamaica Stock Exchange (JSE) Group which tripled in price. These gains were supported by strong fundamentals and should remain for the rest of 2015, according to equity manager Richard Deane, securities dealer at Mayberry Investments.

Even without investing in those six stocks, the vibrant market recorded high double-digit gains in more than 35 stocks on the main and junior markets. These gains are rare and raise concerns of a rising bubble, but Deane discounted these fears.

“As long as the macro factors remain positive and company earnings continue to grow, then the stock market growth will remain sustainable,” stated Deane in a mailed response to Jamaica Observer queries.

He added that the Government has been meeting its International Monetary Fund targets and the Bank of Jamaica has shown a willingness to facilitate an orderly depreciation of the Jamaican dollar which has “relatively” increased price multiples during 2015 when compared to January 2014.

Over the review period stocks with triple-digit gains included: the JSE Group Ltd up 302 per cent from $1.57 to $6.32; Radio Jamaica up 209 per cent from $1.13 to $3.49; Caribbean Cement Company up 147 per cent from $2.41 to $5.95; Paramount Trading Ltd up 129 per cent from $2.62 to $6.00; Hardware & Lumber up 120 per cent from $7.94 to $17.50; and Caribbean Cream up 113 per cent from $0.75 to $1.60. Deane indicated that confidence was another factor influencing the market rally.

“All markets rally on the basis of confidence. During the last seven months, the market has been showing steady upward momentum mainly, but not exclusively, due to an increase in confidence on a systemic level,” explained Deane.

The main index increased 27.4 per cent over the first half of the year with 27 stocks advancing and five declining, while the junior market index increased 33 per cent over the period with 18 advancing and three declining. The JSE Group posted huge profits for its March quarter 2015 amid the market trending towards record levels.

The JSE which regulates listed companies earned $87 million in net profit for its March 2015 quarter, which reversed losses of $2.3 million recorded a year earlier. The bulk of the profit rise came from increased revenues up 172 per cent year-on-year to $259 million, due mainly to increases in billable market activity.

For instance, cess grew by 970 per cent over the period to $161.4 million compared to $15.1 million a year earlier. Earlier this year, other analysts who spoke to the Business Observer attributed the rise in the market to strong profits amid an improving macro economy characterised by reduced currency movements, low inflation and a tame fixedincome market.

The JSE Combined Index closed at 100,600 points on Monday, which still remains close to the all-time high recorded a month ago on June 1st at some 101,869 points. The Combined Index measures the performance of all the companies that list ordinary shares on all the markets.