Chrispin Inambao
20 October 2008
Windhoek — The unprecedented financial hurricane that crippled many global financial markets precipitating colossal bailouts has seen the stocks of NSX-listed companies still intact.
Financial analyst at Simonis Storm Securities Romé Mostert however said the global financial tsunami has badly affected companies that are dual-listed on the Namibia Stock Exchange (NSX) and the Johannesburg Stock Exchange (JSE) such as Anglo-American, BarloWorld specializing in earth-moving equipment, logistics and other corporate lines.
On the other hand the stocks of Shoprite dual-listed on the NSX and JSE are doing fairly well and are unaffected by the shake-up.
Mostert said mono-listed companies that feature on the local index not affected by the ruinous financial upheaval include Trustco that provides life-giving cash to Informanté, NamBrew, FNB Namibia, Namibia Oryx, among others.
He explained the reason the stocks of these companies have remained intact without being eroded by the global crisis is because local NSX-listed companies can only float a certain percentage of shares in accordance with the law.
Which is not the case with firms that are dual-listed and are on the overall index such as the multi-national corporate giant Anglo-American.
The reason why the companies listed both on the NSX and the JSE are so "badly" affected by the crisis is that global market conditions affect their stock, as is the case, explained the analyst.
One of the reasons cited for the crisis is that some people got more credit to service outstanding debts through credit cards.
There are other more complex explanations for the current financial dooms-day scenario that triggered multi-billion dollar bailouts.
Mounting fears of global recession hammered world stocks on Thursday, with Tokyo suffering its worst loss in two decades and Europe in freefall for a second day running after a brutal sell-off on Wall Street.
Renewed panic erupted in trading rooms, with Tokyo closing down more than 11 percent and European indices briefly shedding almost 6 percent in early deals.
Wall Street's major indices endured losses of between 7.9 percent and 9 percent after a dismal United States retail sales report stoked fears that the credit crunch would push some of the world's biggest economies into deep downturns.
Be the first to Write a Comment!
Copyright © 2008 New Era. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
