The Markets

LONDON (Capital Markets in Africa)- Donald Trump has spent the past four years lobbying unsolicited advice at British prime ministers on the best path forward for an exit from the European Union and holding out promises of a grand new trans-Atlantic trade alliance. Now that Brexit is official, though, Trump gets to really double down on a role he relishes: that of the geopolitical disruptor. Just as Prime Minister Boris Johnson wants to use talks with the…

LAGOS (Capital Markets in Africa) – The African Development Bank has downplayed the risks associated with rising debt levels on the continent, saying policy makers should find a balance between fiscal management and funding development. While the median ratio of government debt-to-gross domestic product rose to more than 50% in 2018 from 25% in 2008, bringing the continent’s total external debt burden to almost $500 billion, “Africa does not have a systemic debt crisis,” AfDB…

GABON (Capital Markets in  Africa): Gabon, one of the lowest-rated sovereigns in Africa, is set to become the first on the continent to tap international markets this year even as concerns over the outbreak of the coronavirus test risk appetite. The government is marketing 10-year dollar securities with yields of around 7%, according to a person familiar with the transaction who asked not to be identified because they are not authorized to speak about it. Yields on…

LAGOS (Capital Markets in  Africa): While emerging-market stocks and currencies are set to close January on a low note amid mounting concerns about the spread of the deadly coronavirus, bonds have become the go-to asset as investors begin to price in the prospect of lower interest rates to stimulate growth. The average yield on developing-nation local-currency bonds dropped 11 basis points in January to an all-time low of 4%, handing investors a total return of 0.5%. Hard-currency…

NEW YORK (Capital Markets in  Africa): U.S. consumer spending moderated and business investment continued to deteriorate at the end of 2019, while a smaller trade deficit and more home construction helped keep economic growth steady. Gross domestic product expanded at a 2.1% annualized rate for a second straight quarter, according to Commerce Department data Thursday. The median forecast in a Bloomberg survey of economists called for 2% growth. Consumer spending decelerated to a 1.8% pace, below projections and the weakest since the…

JOHANNESBURG (Capital Markets in Africa) – On a grim day for global equities, South African stocks have been hit harder than most of their emerging-market peers. The local benchmark index dropped as much as 2.6% in Johannesburg Monday, the steepest decline in more than eight months. The MSCI Emerging Markets Index fell as much as 0.8%. South African stocks came in for particular punishment because of their high exposure to China, source of the deadly coronavirus outbreak that’s chasing investors away…

NAIROBI (Capital Markets in Africa): Kenya’s only licensed online currency-trading money manager, Standard Investment Bank, plans to add more retail investors to its forex-focused fund and grow it to $100 million this year.   In 2019, its first year, Mansa X as the fund is known, returned an average 24% and closed at $3 million, SIB Executive Director for Global Markets Nahashon Mungai said in an interview in Nairobi. That compares with returns of 18.5% for…