African Stock Market Mid-Year 2015 Report: BRVM June leader, Botswana Q2 winner, Malawi YTD champ

Lagos, Nigeria, Capital Markets in Africa — African stock market performance measured by country equity benchmark index return ended in red for the month of June, with seven advancers and eleven decliners on the local currency basis. The June monthly returns ranges from  -4.7% registered by the Egyptian stock markets (measured by EGX30 index) to 5.49% recorded by Ugandan equity markets. Looking it from the quarterly return basis for local investor, African equity performance ended on neutral market sentiment, with 9 gainers and 9 losers for the second quarter (Q2) against positive market sensitive recorded at first quarter (Q1). Botswana stock exchange was the top performer, by adding 10.3% in Q2 against 2.0% in Q1 while Egypt equity markets was crowned the biggest loser in Q2, by shredding off 8.4% to settle at 8371.53 points and lost about EGP 21 billion (US$2.7 billion) in market capitalization. On the year-to-date basis, which is the same as the mid-year performance, the market strength was slightly in positive, with 10 leaders and 8 laggards. Botswana equity market also topped the leaders’ chart after surging by almost 12.5 percent and gaining nearly BWP 6.0 billion in market capitalization over the period. Whereas, the Zimbabwe was the worst performer slid by 8.8 percent on year-to-year basis. From the foreign investor viewpoint, African equity shed off an average of 0.9% (on a 1 month return basis) and 5.7% 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 Ghanaian Cedi and Ugandan Shilling have depreciated by 35.35% and 19.46% respectively against the US Dollar. The FTSE ASEA Pan Africa Index and the S&P All Africa Index for instance, both went down by 8.7% and 1.9% respectively. In comparison with other equity markets, African equity market underperformed against major developed and emerging equity markets.  For instance, the S&P 500 index (+0.24% year-to-date), the UK FTSE 100 index (+0.17% year-to-date on US dollar basis) and Hong Kong index (+8.36% year-to-date on dollar basis). However, it outperformed the Brazilian equity markets which recorded -9.90% year-to-date return on dollar basis. The best performing market year-to-date for foreign investors was the Malawi equity market with a year-to-date return of 13.4% (measured by Malawi Stock Exchange MSE All Share Index return) out of which about 5.8% is due to the strengthening of Malawian kwacha against the US dollar.  This is followed by the Botswana and Tunisia equity markets recording year to date returns of 8.5% (measured by the BSE Domestic index) and 7.5% (measured as the Tunis All Share Index) respectively. It is worth noting that both Botswana and Tunisia indices had consistently appreciated for each month during the course of the year. On the other hand, the top two worst performing markets in Q2 for foreign investors are the Uganda equity market and Kenya equity market which both underperformed by 13.3% and 12.60% respectively. Whereas on the year-to-date basis, Ghana equity market (declined 23.1%), Zambian equity market (plummeted by 19.2%) and Mauritius equity market (fell by 13.4%). Looking at the June dollar return, the top worst losers were Ghana, Egypt and Zambia losing 6.9%, 4.7% and 4.3% respectively. 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.