JSE Profit Surges as Fed-Induced Sell-Off Boosts Trading Volumes

JSE Ltd. (JSE), which operates the Johannesburg Stock Exchange, said first-half profit almost tripled as speculation the Federal Reserve will reduce stimulus increased volatility, boosting trade on Africa’s largest bourse.

Net income climbed to 293 million rand ($29 million) in the six months through June, compared with 101 million rand a year earlier, the company said in a statement today. Operating revenue increased to 794 million rand from 683 million rand.

“We’ve seen a big pick up in volatility and activity.” Harry Botha, an analyst at Avior Research (Pty) Ltd., said by phone from Johannesburg before the results were released. “In terms of trading activity we’re seeing enough to retain momentum.”

The exchange, which also operates the nation’s bond and futures market, is benefiting from increased volumes in instruments from stocks to derivatives after Fed Chairman Ben S. Bernanke in May indicated that monetary stimulus may be scaled down as soon as this year as the U.S. economic recovery gains momentum. Trading volumes in equities during the first half surged 58 percent from a year ago, JSE said

The shares increased 1.8 percent to 84.50 rand as of 3:21 p.m. in Johannesburg. JSE gained 9.5 percent since July 28, a day before the company said in a trading update that its first-half profit probably rose more than 40 percent.

To contact the reporter on this story: Jaco Visser in Johannesburg at avisser3@bloomberg.net

To contact the editor responsible for this story: Vernon Wessels at vwessels@bloomberg.net

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