Johannesburg - On the back of increased institutional
strength, a strong balance sheet and a reputation for regulatory excellence,
the JSE and its new chief executive, Nicky Newton-King, are looking to the East
for growth.
The JSE Ltd [JSE:JSE] has performed strongly in terms of
volumes of trade and growth compared with other exchanges in emerging markets.
Its balance sheet has recently been fortified by a 3% rise
in revenue and since listing its own stock on the bourse, the share price has
gained 177% in value.
The World Federation of Exchanges recently ranked the JSE
the 20th-largest bourse in the world.
The JSE looks forward to extending markets for its products
and is engaging with peers in the developing world.
In an interview this week, Newton-King said that as an
integral part of a global strategy, the JSE had set out to identify
international growth opportunities.
“We are having discussions with other exchanges in the
(Brazil, Russia, India, China, SA) Brics group. We look forward to growth in
the exchange-traded products, and we are likely to see more of these products
and a greater diversity.”
These discussions are unlikely to yield much merger and
acquisition activity, but are likely to lead to trade in products and a rise in
inward listings
Newton-King said: “China is likely to yield interesting
prospects. We are also interested in Brazil and India, even though India may pose regulatory hurdles.”
Due to the fierce pace of economic growth in China and
Chinese interest in the African continent, the possibilities in the trade of
financial products are likely to increase. The Chinese have a number of
bourses, with the Shanghai Stock Exchange and Shenzhen Stock Exchange the most
significant.
The Shanghai Stock Exchange is the fifth-largest in the
world, with a market capitalisation of $2.7 trillion (R21.5 trillion at the
current exchange rate) as of December 2010.
The Bombay Stock Exchange is the oldest in Asia and is
ranked the eighth-largest in the world. It has a market capitalisation of $1.63
trillion and boasts companies such as Reliance, Tata and Infosys, which have
signalled a strong interest in the African continent.
Said Newton-King: “Africa is going to be a big player, and
the continent is dynamic and growing.”
She said that the JSE would continue to seek technical
co-operation with other African bourses and that the Nigerian capital markets
showed good prospects.
- City Press