JSE looks to the East for growth

2012-01-28 14:55

On the back of increased institutional strength, a strong balance sheet and a reputation for regulatory excellence, the JSE and its new chief executive, Nicky Newton-King, are looking to the East for growth.

The JSE has performed strongly in terms of volumes of trade and growth compared with other exchanges in emerging markets.

Its balance sheet has recently been fortified by a 3% rise in revenue and since listing its own stock on the bourse, the share price has gained 177% in value.

The World Federation of Exchanges recently ranked the JSE the 20th-largest bourse in the world.
The JSE looks forward to extending markets for its products and is engaging with peers in the
developing world.

In an interview this week, Newton-King said that as an integral part of a global strategy, the JSE had set out to identify international growth opportunities.

“We are having discussions with other exchanges in the (Brazil, Russia, India, China, SA) Brics group. We look forward to growth in the exchange-traded products, and we are likely to see more of these products and a greater diversity.”

These discussions are unlikely to yield much merger and acquisition activity, but are likely to lead to trade in products and a rise in inward listings.
Newton-King said: “China is likely to yield interesting prospects. We are also interested in Brazil
and India, even though India may pose regulatory hurdles.”

Due to the fierce pace of economic growth in China and Chinese interest in the African continent, the possibilities in the trade of financial products are likely to increase. The Chinese have a number of bourses, with the Shanghai Stock Exchange and Shenzhen Stock Exchange the most significant.

The Shanghai Stock Exchange is the fifth-largest in the world, with a market capitalisation of $2.7?trillion (R21.5?trillion at the current exchange rate) as of December 2010.

The Bombay Stock Exchange is the oldest in Asia and is ranked the eighth-largest in the world. It has a market capitalisation of $1.63?trillion and boasts companies such as Reliance, Tata and Infosys, which have signalled a strong interest in the African continent.

Said Newton-King: “Africa is going to be a big player, and the continent is dynamic and growing.”

She said that the JSE would continue to seek technical co-operation with other African bourses and that the Nigerian capital markets showed
good prospects.

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