Thursday, March 28, 2024 UTC

Recognized by industry leaders for extensive coverage on African Asset Management

News > Funds > Markets and Industry News

Africa bond indices show strong performance in 2014

Africa Global Funds
Jan. 7, 2015, midnight
369

Word count: 351

Whilst equities were in the red in 2014, it was a strong year for Africa bond indices, according to Tim Edwards, Senior Director, Index Investment Strategy at S&P; Dow Jones Indices.

Choose ONE Magazine and TWO Articles for FREE when you register an account
Share:

Whilst equities were in the red in 2014, it was a strong year for Africa bond indices, according to Tim Edwards, Senior Director, Index Investment Strategy at S&P Dow Jones Indices.

The S&P Africa Sovereign Bond Index posted 1.66% and the S&P Africa Sovereign Ex-SA Bond Index closed at 2.91% for the year.

“In the fixed income markets, a mixed month completed a strong year in Africa bond indices. Our pan-regional indices even posted gains for the year in U.S. Dollar terms, some feat for a year in which the U.S. currency gained by 10% or more against many local currencies,” he said.

“With 10-Year U.S. Treasury yields recently dropping below 2% and other developed markets offering yields that are mere fractions of a percent, the double-digit yields offered in Africa have been attracting attention,” he added.

In December, the S&P All Africa index slumped by 5.0% – double its gain over the previous eleven months - to record a total return of -2.5% for the year.

According to Edwards, for the year, among regional stock indices only three were in the green.

The S&P East Africa 10 index soared 21%, the S&P Africa 40 index was up 14% and S&P North Africa 15 index added 13%.

“A poor December did not prevent Egypt from boasting the best returns among the major single-country equity markets for the year. The S&P Egypt BMI delivered a total return of 29% in 2014, with second-best performer South Africa posting an 18% gain,” he said.

“While Egypt’s performance was credited to a highly depressed valuation a year ago, South Africa’s performance is particularly laudable given the challenges to commodity producers and emerging markets generally this year,” he added.

The S&P Nigeria BMI index was the worst hit, falling 6.8% in December and recording a total return of -28% for the year in response to a collapsing oil price.

The S&P South Africa Dividend Aristocrats topped the charts in 2014 among South African equity indices, closely followed by the S&P South Africa Low Volatility Index.

“Based on such performances, the popularity of dividend and low volatility based investment themes looks set to continue into 2015,” concluded Edwards.

Registration Login
Sign in with social account
or
Lost your Password?
Registration Login
Sign in with social account
or
Registration Login
Registration