JSE gets Covid-19 boost


JSE gets Covid-19 boost

Published Date: 2020-06-29 | Source: Stephen Gunnion | Author: Stephen Gunnion

JSE gets Covid-19 boost

The stock and bond exchange operator says market volatility has supported first-half earnings, masking weakness in the economy and financial markets.

JSE Ltd, operator of the stock exchange, says it's likely to post a pleasing rise in first-half earnings as increased market volatility resulted in a rise in trading activity.

In a trading statement, the JSE said it experienced an increase in revenue activity drivers and a change in trading patterns in the main markets it operates over the six months to end-June. Sentiment and volatility over the period were affected by the impact of Covid-19, as well as Moody's sovereign credit downgrade which resulted in the exclusion of SA government debt from the World Government Bond Index. Net foreign outflows in the equities and bond markets in the period to date had exceeded R45 billion and R68 billion respectively. The equities market, in particular, had recorded material increases in value traded which had translated into higher operating revenues.

The exchange said growth in other income was supported by an uplift in foreign exchange gains. However, it incurred higher personnel costs as a result of executive changes, including related retention and restraint payments. It was also faced with additional costs as it responded to Covid-19.

For the six months, it said earnings per share (EPS) were expected to be between 16% and 24% higher than the 467c reported last year, while HEPS would be up by the same range.

It said it remained strongly cash generative and was sufficiently capitalised. Its shares rose 3.1% to R125.02 on Friday.

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