News and developments on African capital markets: African securities, African stock exchanges, African equities, African bonds, African private equity/venture capital, and African social impact investment. Twitter @africancapital, LinkedIn African Securities Exchanges group.
RisCura’s annual Bright Africa report into African securities exchanges is out and highly-recommended. Key challenge to investors, African stock exchange operators and regulators remain: liquidity, free float and cost of trading. Broker commissions are high, but with low trading volumes they need incentives to change.
Africa’s stock exchanges have too few listings and too little trading, and regionalization may be one way to grow, argues The Economist magazine.
The 5th Building African Financial Markets (BAFM) capacity-building seminar is coming to the Nigerian Stock Exchange Event Centre in Lagos on 28-29 April, organized with the African Securities Exchanges Association.
The International Organization of Securities Commissions (IOSCO) published on 4 March a report on liquidity risk management for collective investment schemes (CIS)
Africa’s 24 stock markets should learn to work together better if they are to seize high levels of investor interest, said Nicky Newton-King, CEO of South Africa’s JSE Ltd. She told an interviewer that plumbing, – technology and other links between exchanges and clearing and settlement – were more likely routes to more liquidity than trying to create a single exchange.
Today the Nigerian Stock Exchange is to launch its market-making programme. This will be a hybrid process, with market makers offering 2-way (buy-sell) price quotes in selected securities and a continuation of the current process in which licensed broker/dealers of the NSE submit orders.
Reuters newsagency has put together stories on issuers’ and investors’ difficulties with African stock markets. These include lack of liquidity and sinking currencies. It notes that African companies are increasingly dual listing on international stock exchanges.
South Africa’s Johannesburg Stock Exchange says that a record number of trades were executed on the exchange today (10 August). The new record is 230,797 trades, valued at more than $4 billion.
The Nairobi Stock Exchange and FTSE International are to create new FTSE/NSE share and bond indices. These could be marketed to international investors.
Two big European alternative markets – Chi-X Europe and BATS – are talking about a merger as the European stockmarket sector could start to consolidate. The two issued a joint statement on 22 December confirming they “have entered into exclusive negotiations regarding the potential sale of Chi-X Europe to BATS Global Markets.”