That the Johannesburg Stock Exchange is the largest in Africa doesn’t mean it says one thing and means the other. Recent data from the Bank of America Merrill Lynch Global Research shows that more foreigners own shares on the Johannesburg Stock Exchange than South Africans themselves. To be precise, about 52% of the shares on the Johannesburg Stock Exchange are owned by foreigners.
Again, latest numbers from the JSE indicate that foreigners resell most of their South African shares. The amount resold from the start of April to the first week of May, 2019 stood at R5 billion. In fact, foreigners resold about R3 billion shares in the three days before the national and provincial elections alone.
What Areas The Foreigners Are Going To Most
Mining
Some 62% of mining shares on the JSE are now in foreign hands, and overseas investors have increased their mining holdings over the past year, particularly in platinum and gold companies, except for Harmony.
Financial And Industrial Shares
The percentage of foreigners who go for local financial shares is 37% and industrial is 54%.
Foreigners also bought Clicks shares — but sold Woolworths, Massmart, Foschini, Truworths, Dis-Chem, Shoprite and Spar.
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Foreigners were also net buyers of of Reunert and Reinet, the property shares Resilient and Intu, and added to holdings in Capitec.
Telecom and Retail Shares
Foreigners have also been selling their stakes in South African-focused companies over the past year, particularly telecom and retail shares.
The report shows that foreign investors sold Vodacom and MTN, but were net buyers of Telkom in the past year.
Source: BofA Merrill Lynch South Africa Strategy
The Top Foreign-owned Stocks
The top five foreign-owned stocks are now Richemont, BHP, Gold Fields, Harmony, and Anglo Gold.
The domestic names foreigners are going after are Clicks, Lewis, Tiger Brands, Discovery and Telkom which have the highest foreign holdings.
Foreign holdings in Naspers — which represents a fifth of the Stock Exchange — has fallen from 65% in 2016 to 62%.
The report found that if shares listed on other exchanges — like BHP Billiton and Richemont — are excluded, foreign investors owned only 46% of domestic shares, down from 48% last year.
Charles Rapulu Udoh
Charles Rapulu Udoh, a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.