African Equity Market July 2015 Report: BRVM rewards local investors, Botswana strengthens foreigners capital

Lagos, Nigeria, Capital Markets in Africa — African stock market performance measured by country equity benchmark index return ended in negative for the month of July, with eight gainers and 10 losers on local currency basis. The July average return of -1.5 percent was recorded across eighteen African equity indices and July monthly returns ranges from  -9.8% registered by the Nigeria equity markets  (measured by NSE All Share) to 8.2% recorded by Cote d’Ivoire equity market (measured by BRVM Composite All Share). Whereas Rwanda Stock Exchange All Share index surged by 5.90 percent and Botswana equity markets added 2.30 percent to emerge as second and third best performers respectively, for the month of July.

 The market strength ended neutral with 9 leaders and 9 laggards on year-to-date basis.  The average returns across eighteen Africa equity indices was recorded at 0.5 percent. Cote d’Ivoire equity market (measured by BRVM Composite All Share) also topped the leaders’ chart after surging by almost 16.71 percent and nearly gained XOF 1,287 billion (US$2.2 billion) in market capitalization over the same period. On the contrary, the Nigeria equity markets emerged as the worst performer plummeted by 12.8 percent and shed off NGN1.2 trillion (US$5.9 billion) in market capitalization on year-to-date basis..

From the foreign investor viewpoint, African equity shed off an average of 3.4 percent (on a 1 month return basis) and 9.0 % on a year-to-date basis. This is attributed to the appreciation of US Dollar against the majority of the African currencies, for instance since the start of 2015 Ugandan Shilling and Tanzania Shilling have depreciated by 23.9% and 20.6% respectively against the US Dollar. The African equity benchmark indices, FTSE ASEA Pan Africa Index and the S&P All Africa Index for instance, both tumbled by 3.1% and 3.1% respectively in the month of July.

For foreign investors, Rwanda equity markets emerged as  best performing market  with 8.3% July month return (measured by Rwanda Stock Exchange All Share Index return) out of which about 2.4% is due to the strengthening of Rwanda franc against the US dollar.  It is followed by the Cote d’Ivoire and Ghana equity markets recording year to date returns of 7.4% (measured by the BRVM Composite index) and 6.5% (measured by the GSE Composite index) respectively for the month of July. Looking at the year-to-date dollar return, the top gainers were Botswana, Rwanda and Cote d’Ivoire after surging by 8.6%, 6.9% and 6.4% respectively.

On the other hand, the top two worst performing markets in July for foreign investors are Malawi equity market and Kenya equity market which both under performed by 13.6% and 12.4% respectively. Whereas on a year-to-date basis, Zambia equity market (declined 22.5%), Ugandan equity market (plummeted by 20.9%) and Nigeria equity market (fell by 20.1%).

Note:

• The S&P All Africa index is a comprehensive benchmark for the African market, covering companies listed in 13 countries: Botswana, Côte d’Ivoire, Egypt, Ghana, Kenya, Mauritius, Morocco, Namibia, Nigeria, South Africa, Tunisia, Zambia and Zimbabwe plus companies listed in developed markets that derive the majority of their revenue from the African continent.
• The FTSE ASEA Pan Africa Index Series represents the performance of eligible securities listed on ASEA (African Securities Exchanges Association) member exchanges. It is a free float market capitalisation weighted index series constructed from securities domiciled in the almost eighteen countries.
• BRVM Bourse is the regional stock exchange for eight West Africa countries: Benin, Burkina Faso, Guinea Bissau, Cote d’Ivoire, Mali, Niger, Senegal and Togo.