Geopolitical Shocks Drag Markets as Oil Surges and Volatility Returns
TLDR
- The BRVM Composite Index rose 1.36% to 306.17 last week, sustaining momentum above the 300-point threshold despite broader global volatility
- Gains were driven by Palm (+20.38%) and Servair (+10.84%), while the BRVM 30 added 1.26%
- Global equities pulled back sharply. The S&P 500 fell 0.47%, the Nasdaq 0.79%, and the Dow 1.07%, as geopolitical tensions escalated
The BRVM Composite Index rose 1.36% to 306.17 last week, sustaining momentum above the 300-point threshold despite broader global volatility. Gains were driven by Palm (+20.38%) and Servair (+10.84%), while the BRVM 30 added 1.26%. Index breadth remained healthy, supported by agricultural and consumer stocks. Market capitalization reached 11.8T FCFA.
In Africa, the NGX climbed 2.67%, with financials and pharmaceuticals outperforming. The NSE rallied 8.99%, bolstered by Olympia Capital (+10%) and Longhorn Publishers (+5.47%). Meanwhile, the JSE slipped 1.08% under pressure from large caps and industrial names, despite standout gains from Visual International (+100%) and Oando (+40%).
Global equities pulled back sharply. The S&P 500 fell 0.47%, the Nasdaq 0.79%, and the Dow 1.07%, as geopolitical tensions escalated. The Euro Stoxx 50 sank 2.31%, while the FTSE 100 and SSE Composite remained largely flat. Volatility spiked, with the VIX closing at its highest in three weeks amid investor flight to safety.
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Key Takeaways
Next week’s market tone hinges on the fallout from the escalating Israel-Iran conflict, which triggered a 7% spike in oil prices on Friday and heightened global risk aversion. Reports of Israeli strikes on Iran’s gas infrastructure and the potential threat to the Strait of Hormuz have investors bracing for further supply shocks, inflation pressures, and short-term equity downside. Expect markets to remain highly headline-driven. Volatility will likely stay elevated as traders monitor crude futures, safe-haven flows into gold and the dollar, and global central bank reactions. In Africa, local fundamentals remain solid, and BRVM, NGX, and NSE may continue to attract inflows from regional investors seeking yield amid global uncertainty.
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