Trading is currently normal
Botswana Stock Exchange (BSE) could feel the pinch of the ongoing Russia=Ukraine war should it go on for a prolonged period of time, the CEO of the BSE, Thapelo Tsheole, has said.
This is because as prices of certain commodities go up, especially wheat and fuel, operations of some companies in Botswana and their participation on the bourse could be affected.
“People were optimistic that we are recovering from COVID and things were expected to get better but now all of a sudden we are in a war,” Tsheole said adding that the impact on the BSE will depend on the speed at which the war escalates.
If things unravel quickly, so will be the impact on the stock market. When that happens, he noted, investors are likely to become reluctant to trade on the market while others would opt for more secure assets. “At times like these, people move to safe assets such as gold and gold Exchange Traded Funds,” said Tsheole.
For now, however, trading is normal and there has not been any impact of the Russian-Ukraine conflict. Tsheole said it is his hope that things will remain this way and the conflict will not turn into a full-blown war affecting and involving other countries.
Meanwhile, since the start of the Russia-Ukraine war, the global capital markets have experienced an initial plunge on February 24 and then stabilized and rebounded in the second trading day on February 25. According to analysts, judging from the reflection of the capital markets, the initial impact of the crisis was not too drastic. They believe this may have something to do with the influence of the countries involved in the capital markets.
However, in terms of its long-term developments, analysts believe that the evolution of geopolitical conflict patterns brought about by the Russia-Ukraine crisis will inevitably affect global investment decisions and capital flows.