Shrinking giant still has value
The JSE's risky business
The JSE gives local investors access to global stocks, but SA’s economic slowdown and expenses take their toll
Not even the mighty JSE is without threat. Facing competition from new entrants for the first time in 60 years and a drop in trading activity amid a sluggish economy, the bourse has been forced to slash costs. After spending R283m on technology in 2016, a 20% increase on the previous year, the exchange now says it will reduce its technology operating expenditure by at least R70m over the next two years. It will also cut its fulltime staff complement by 14% — about 60 people. This is expected to save nearly R170m/year from 2019, on top of the R65m in annualised savings it has already achieved by removing vacancies and reducing discretionary spend. The restructure is a response to changes in regulation and technology, as well as the economic malaise gripping SA: gone are the days when our stock market bore no resemblance to economic fundamentals. The JSE’s all share index has posted annual gains below 4% for the past three years. Meanwhile, the average daily value traded on the exchan...