Global and local market conditions
Most developed markets bounced back this week after steep falls in the previous week. The climb was driven by a US Labour department report showing a decline in job benefits claims that was more than expected (Bloomberg). Investors are also expecting strong corporate results many of which will be reported in the course of the next four weeks, and are back in the market looking to pick up bargains. Financial stocks in particular have rallied after State Street reported better than expected second quarter forecast earnings (Washington Post). The major Sub-Saharan stock markets ex-South Africa: Ghana, Nigeria and Kenya all dropped slightly in the week. Sub-Saharan markets have out-performed most of the world's equity markets this year. Within Africa, the Nairobi Stock Exchange has been the best performer in the year to date with the NSE-20 Share index up 32%. Strong half-year results particularly in the financial sector should drive the rally in Nairobi even further in the coming weeks. A successful referendum on August 4th to amend the constitution should fuel the market ascent.
