The JSE said on Monday that in spite of increased global uncertainty and the additional focus on the regulation of financial markets, the FTSE/JSE All-share Index (Alsi) rose 13.86% from December 2009 to December 2010.
It reached a high of 32 210 trades towards the end of December 2010.
"For 2010, daily average trades increased 13% to 94 656 trades compared with the corresponding period in 2009. That equates to a total of transactions for 2010 at 23 758 658, compared with 20 950 750 and 17 398 986 recorded in 2009 and 2008 respectively," it said.
Trades hit a record in June, when 205 748 transactions valued at more than R20bn were recorded on the exchange.
"This is the first time in the JSE's 123-year history that the number of trades has crossed the 200 000 mark. The previous record was set on May 7 2010, when 189 253 transactions were recorded. The rise in 2010's average daily trade numbers contributed to the record," it said.
The JSE said that SA's ranking in the World Economic Forum's 2010/2011 Global Competitiveness Review - as the world's best regulated financial market - bodes well for offshore interest in JSE capital markets.
A new equities market billing model, introduced in March 2010 in a bid to create incentives for high-volume and high-value participants, contributed to the increased trade.
"A further change will be implemented on February 1 2011, where the current minimum of R5.48 will be reduced to R5 and the ceiling amount of R12.34 will be increased to R18. This would be a second step towards moving to a more value-based billing model," said Leanne Parsons, head of the equity market at the JSE.
Retail growth focus
Volatility in the market could have also contributed to the increased trade, it said.
It would continue to encourage individual or retail investments.
"The JSE views the South African retail market as a long-term growth area and continues to pursue its strategy of increasing the financial knowledge of South Africans with the aim of growing the number of retail investors and adding to trade volumes," said Parsons.
The JSE said that while foreign investor interest in its equity market had waned from the record inflows of 2009, strong inflows continued.
By end-November 2010, foreigners were net buyers of local equities to the value of R31.4bn.
The increasing appetite for Africa as an investment destination is yielding results and in the first six months of 2010, total investment fund allocation to Africa was a record $1.39bn, according to investment research firm EPFR.
"The JSE's Africa strategy is aimed at contributing to the improvement of Africa's capital markets. The exchange's Africa board offers a destination for trade of quality African companies, acting as a gateway for investors wanting to access African securities," it said.
Showing posts with label JSE. Show all posts
Showing posts with label JSE. Show all posts
Monday, January 24, 2011
Tuesday, January 4, 2011
Thursday, October 28, 2010
Sound Issuance - South African ECM Gets Noticed on the Global Stage
South Africa has been the sleeping giant of emerging markets for many years. While emerging European equity capital markets issuance was rampant from 2005 on, South Africa was a rare source of interest. Yet volumes are climbing while Russia slumbers and 2007 totals are now in sight.
Extracts from the International Financing Review (IMF), circa October 2010:
There are also some comments about the two biggest listings this year, Life Healthcare and Optimum Coal.
Real the full article here.
Extracts from the International Financing Review (IMF), circa October 2010:
The sound of vuvuzelas has passed in South Africa following the world cup, but the country is now buzzing to a different sound: visiting equity capital market bankers rushing around to pitch to potential issuers. Bankers are keen to ensure they are involved in the resurgence in emerging market activity.
...
“Government policy and black empowerment has facilitated the emergence of a broader middle class and a redistribution of wealth,” said George Pavey, co-head of emerging markets ECM at Credit Suisse. “Robust population growth and an emerging middle class, coupled with a rebound in demand for commodities, are fuelling economic growth and helping the performance of South Africa’s equity market.
...
“South Africa has emerged from the financial crisis as a winner, attracting a disproportionate share of inflows into emerging markets courtesy of the quality of many companies in SA, the strong corporate governance, transparency, relatively conservative balance sheet structures. South Africa is a lower beta market, but it is a good place to put money,”
...
The positive mood is reflected in the build out of investment banking operations. While Credit Suisse had no bankers in the country three years ago, it is now in the process of building a team of around 60 bankers to cover Southern Africa. In 2007 South African ECM volume was strong with nearly US$8bn raised through 24 deals. As a relative measure in the same year, UK volume was about US$50bn. However the importance of South Africa dropped in 2008: the number of deals was flat but volume dropped to US$3.7bn, putting the country sixth against the rest of Africa and the Middle East. Significantly, the number of deals rose to 36 in 2009, thanks to a stream of rights issues, and the year to-date total in 2010 is already flat to the full-year of 2009.
There are also some comments about the two biggest listings this year, Life Healthcare and Optimum Coal.
Real the full article here.
Monday, October 4, 2010
UT Bank of Ghana to List on JSE Africa Board
Ghana's UT Bank may consider listing on the Johannesburg Stock Exchange's Africa board, its chief executive said on Monday.
Kofi Amoabeng told Reuters in Johannesburg that the group was also interested in selling up to 20% of the bank to an foreign partner.
He added that UT Bank aimed to at least double its balance sheet in the next three years from the current $250m.
The other two listings on the JSE Africa Board:
Trustco Group Holdings
Wilderness Holdings Limited
Kofi Amoabeng told Reuters in Johannesburg that the group was also interested in selling up to 20% of the bank to an foreign partner.
He added that UT Bank aimed to at least double its balance sheet in the next three years from the current $250m.
The other two listings on the JSE Africa Board:
Trustco Group Holdings
Wilderness Holdings Limited
Friday, April 30, 2010
Equities: Proceed with Caution
High PE ratio = danger
Historically, the market has only spent 15% of its time at a PE ratio of 16 or higher. The market is currently at an un-nerving PE ratio of 17.6. Historically it has only been higher than this level 6% of its time, therefore the market is not cheap if history is anything to go by.
Historically there have been 6 (broadly speaking) periods where the market has broken through a PE ratio of 16 (see Figure 1). We can test the theory of "high PE ratios equate to poor commensurate equity returns" by tracking the performance of the equity market as the PE ratio goes through some predetermined level. Setting the PE ratio at 16 generates some interesting results with regards to equity market vs. cash returns. The subsequent 3 year returns (post a PE ratio > 16) for the All Share Index (yellow) and Cash (red) are plotted in the graph (Figure 2) below.
Briefly what does the graph above (Figure 2) say?
1. Cash has out-performed equities 4 out of the 5 times over a 3 year period.
2. The market has experienced a serious crash within 3 years, 2 out of 5 times.
3. The market has rallied at least 34%, 5 out of 5 times from the point the market PE ratio goes above 16.
In summary the All Share Index has fared poorly relative to cash over a 3 year period when the PE ratio has breached 16. Secondly it is important to recognize that the market can initially perform very well over the short-term even when the valuations look very expensive on a PE ratio basis. Figure 2 and Table 1 highlight this fact with interim returns having reached between 34% and 68.5% before market returns turn sour.
Historically, the market has only spent 15% of its time at a PE ratio of 16 or higher. The market is currently at an un-nerving PE ratio of 17.6. Historically it has only been higher than this level 6% of its time, therefore the market is not cheap if history is anything to go by.
Historically there have been 6 (broadly speaking) periods where the market has broken through a PE ratio of 16 (see Figure 1). We can test the theory of "high PE ratios equate to poor commensurate equity returns" by tracking the performance of the equity market as the PE ratio goes through some predetermined level. Setting the PE ratio at 16 generates some interesting results with regards to equity market vs. cash returns. The subsequent 3 year returns (post a PE ratio > 16) for the All Share Index (yellow) and Cash (red) are plotted in the graph (Figure 2) below.
Briefly what does the graph above (Figure 2) say?
1. Cash has out-performed equities 4 out of the 5 times over a 3 year period.
2. The market has experienced a serious crash within 3 years, 2 out of 5 times.
3. The market has rallied at least 34%, 5 out of 5 times from the point the market PE ratio goes above 16.
In summary the All Share Index has fared poorly relative to cash over a 3 year period when the PE ratio has breached 16. Secondly it is important to recognize that the market can initially perform very well over the short-term even when the valuations look very expensive on a PE ratio basis. Figure 2 and Table 1 highlight this fact with interim returns having reached between 34% and 68.5% before market returns turn sour.
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