Advansa International follows exchange rates and stock market indexes for several emerging and frontier markets. Exchange rates and stock indexes are recorded on the last trading day of the week. The tables below show changes from the last trading day of the last full week of the quarter for several key markets in Africa.
*Includes most French speaking countries such as Benin, Cameroon, Cote D’ivoire, Guinea, Senegal, Togo and others
The African story in the fourth quarter was one of strong stock markets but weak currencies. The MSCI Africa index increased by 3.80% in local currency, compared with the MSCI Emerging markets index which was up .79%. However in dollars the Africa index was virtually unchanged at .33%, though still a bit better than the Emerging Markets Index which was down .23%. All the major stock markets were up in local currency. Nigeria was the big winner gaining over 10% (and almost 10% in dollars). Among smaller markets the West Africa Bourse (WAB) gained almost 13%. Because the Euro-linked CFA franc was strong the West Africa Bourse gained almost 15% in dollars. The Ghana Stock Exchange continued its upward march however the cedi continued to weaken wiping out the gains for dollar based investors. Again the financial sector led the way with Ecobank, UT Financial and Cal Bank Ltd. among the volume leaders. The Nigerian and Kenyan markets were also strong, rising 20% and 19% respectively.
The trend is more pronounced when looking at the full year results. All the major stock markets were in weak currency countries except the WAB. The Ghana cedi continues to decline. The economic fundamentals such as rising inflation and current account deficits continue. The Reserve Bank of South Africa continues a loose monetary stance, weakening the rand. In the current market it is wise to recognize the strong performance of individual listed companies, regardless of the macro conditions that impact national economic indicators.