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JSE draws net positive foreign inflows as Moscow wanes

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Volumes traded on the local bourse have doubled over the last week: David Shapiro.

The Johannesburg Stock Exchange (JSE), Africa’s biggest bourse, has seen net positive foreign inflows for the first time in three and a half years, data shows, as emerging market investors shifted funds from Moscow.

Accounting scandals in top companies, anaemic domestic growth, regulatory concerns and corruption allegations against the government combined to make foreign investors wary of the Johannesburg bourse.

They remained net sellers even though the benchmark index on the JSE .JALSH gave a return of 4% and 24% respectively over the last two years.

The net selling trend reversed in mid-February as concern Russia would invade Ukraine mounted, JSE data shows.

As another resource-rich nation, likely to benefit from high commodity prices, South Africa is a logical alternative and in February alone, the JSE saw R15 billion ($991.11 million) and R17 billion of net foreign capital flowing into equity and debt markets respectively.

Foreign inflow were last net positive in August 2018.

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