NSX weathers global storm

LOCAL investors shared global market fears towards the end of last year as the Overall Index of Namibian Stock Exchange (NSX) shed 17,1 per cent to close at 556 points, down from 671 at the end of the third quarter.

Total overall market capitalisation in the fourth quarter tumbled to N$736 million, according to the latest Quarterly Report of Bank of Namibia (BoN), released yesterday.’The decline in overall market capitalisation is in line with the global market performance that continued to be negatively affected by the international financial crisis, but the relative insulation of the local market from these stocks enabled it to remain relatively stable,’ the BoN says. Since the Overall Index consists of dual-listed companies, the performance of global markets has a direct impact on the performance of the local bourse. The Overall Index therefore continued to be exposed to the international market turmoil and recorded a negative return on a 12-month basis of 37,9 per cent.The Local Index, on the other hand, was somewhat shielded against the world’s financial storm and remained resilient, closing 9 points above the 148 points for the third quarter. On a 12-month basis, the Local Index showed a return of 25,2 per cent.’The superior returns offered by the Local Index compared to the Overall Index reflects the relative insulation of the local stocks against the global turmoil that affects stocks in the Overall Index,’ the BoN says.The top three performers in the Local Index were the Nictus Group, followed by FNB Namibia and Namibia Breweries (NBL).Shares in the Nictus Group gained 18,8 per cent in the last quarter, while shares in FNB Namibia appreciated by 11 per cent and those of NBL 3,3 per cent.Local market capitalisation increased by 6,4 per cent to N$5,7 billion compared to N$5,3 billion in the preceding three months. Trading volumes, however, fell.Where more than 1,6 million shares were traded on the Local Index last October, only 77 006 traded hands in December. This resulted in lower traded value: from about N$18,3 million in October to N$883 739 in December.According to the BoN, overall local shares traded in the fourth quarter fell by 83,9 per cent resulting in a drop of 67,9 per cent in local value traded.In comparison, trading on the Overall Index fell by 47,2 per cent which was mirrored by a 37,9 drop in overall traded value.In US dollar-terms, the NSX Overall Index plummeted by 28,3 per cent in the fourth quarter. This is in line with the decline of 21,9 per cent recorded by the All Share Index of the Johannesburg Stock Exchange (JSE), the BoN says.’The weak performances reflected by both indexes was mainly driven by the decline in the resource stocks,’ the BoN explains.jo-mare@namibian.com.na