• Voter paralysis

    With so much tilting voters against change, democratic reason is the loser, says Solly Moeng.

  • The power of perseverance

    True grit is a reliable predictor of who will achieve success in life, says Ian Mann.

  • It's the system

    The system sucks and it’s being used far too often as an excuse, says Mandi Smallhorne.

All data is delayed
Loading...
See More

Bad year for African bourses prompts investor exit

Jan 04 2016 16:24
Malcom Sharara

Harare - Foreign investors suffered huge losses in most African stock markets in 2015, as the continent faced foreign exchange pressures and low commodity prices.

While investors in Botswana and South Africa recorded some gains in local currencies, weakening currencies against a strengthening US dollar resulted in heavy losses for foreign investors.

In rand terms, the JSE All-share Index was up 1.86% in the year 2015 but in US dollar terms, it suffered a 22.55% loss.

On December 9 2015 the rand hit a record low of R15.30 against the greenback after President Jacob Zuma surprised markets by removing finance minister Nhlanhla Nene from his post, replacing him with the relatively unknown backbencher David van Rooyen.

Before #NeneGate the rand had already depreciated by 23% versus the dollar

In pula terms, the Botswana Stock Exchange Domestic Company Index was up 11.59% but suffered losses of 3.89% in US dollar terms.

Zambia’s LuSE All Share Index was 2015’s biggest loser in dollar terms after dropping a massive 45.80%. In kwacha terms the loss was about 6.91%.

Copper slide hits kwacha hard

The kwacha fell by about 48% in 2015 against the dollar as plunging copper prices, a power crisis and the widening budget deficit weighed on the economy.

Other African markets to fall in dollar terms were the Nigerian Stock Exchange All Share Index which lost 23.43%, Kenya’s FTSE NSE index down 23.58% and Ghana’s GSE ALSI which tumbled 25.44%.

The Zimbabwean stock exchange, which trades in US dollar, was 29.45% weaker as most blue chip companies were weighed down by negative economic performance as well as policy and political uncertainty.

In recent years African markets have been one of the preferred destinations for funds shunning lower interest rates in the US, but all that has changed since the US Federal Reserve hiked interest rates.   

Analysts say foreign investors - who are the biggest participants on most African markets - are seeking exit points due to developments at the foreign exchange market, low commodity prices and negative sentiments over poor corporate results.    

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest. 24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

equities  |  markets  |  international markets

NEXT ON FIN24X

 
 
 
 

Company Snapshot

We're talking about:

THE DEBT ISSUE

Debt is one of the biggest financial issues facing South Africans today. Find out how you can avoid and manage your debt with Fin24 and Debt Rescue.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

Would you take out a payday loan?

Previous results · Suggest a vote

Loading...