Emerging Markets were not the only economies that had a tough year in 2018 as Frontier Markets also had their fair share of problems. However, despite some markets posting negative returns over the 12 month period, there were a handful of solid performers during the course of the year. Here were the top 5 Frontier Markets in 2018 (for comparative purposes, the MSCI Frontier Market Index fell by 19.42% in 2018).
1st – Ukraine (80.39%)
Ukraine’s stock market was easily the best performing Frontier Market in 2018 after the PFTS index skyrocketed by just over 80% despite the ongoing geopolitical crisis looming in the background, while other major stock markets around the world recorded negative end-of-year performance numbers.
The PFTS Index opened at 315.7371 and closed at 559.3567, reaching a high of 607.8486 on the 14th November 2018.
Ukraine has also managed to secure loans of $3.9bn and $750bn from the International Monetary Fund and World Bank respectively, and this funding should help boost both domestic and international investor confidence in the market.
2nd – Macedonia (36.64%)
The Macedonian Stock Exchange enjoyed growth of over a third in 2018. The increase comes after the country managed to come to an agreement with Greece over a running disputing regarding the name of the country. Skopje agreed to change the name of the country to the Republic of North Macedonia.
One of the main topics to look out for in 2019 is Macedonia’s negotiations to join the European Union (EU). It is also worth noting that Macedonia was one of the most improved nations in Europe in the Ease Of Business Rankings 2019.
3rd – Jamaica (28.22%)
Jamaica continued its streak of ending the year on a positive note as its bourse ended the year with a 28.22% increase and it doesn’t seem like it will be running out of steam any time soon.
A common feature among the top performers were increases in the share prices that exceeded 100%. These included the likes of Barita Investments (280%), SSL Venture Capital Jamaica (260%) and Derrimon Trading (250%), with the former experiencing a seven-fold increase in its market value from $3bn to $21bn.
Jamaica is also exploring the possible of implementing the ability to trade cryptocurrency on its local platform in the future.
4th – Tunisia (15.76%)
Tunisia is another market that extended its streak of ending the year in the black after positing a respectable increase of 15.76% (compared to 14.45% in 2017 and 8.86% in 2016).
However, the performance of the TUNINDEX was a tale of two halves. The market peaked at a historic high of 8,431.64 points on 28th August 2018 (34% gain) before losing almost 14% in the next four months, primarily due to the weak performance of the banking sector.
5th – Kazakhstan (6.58%)
Completing the list is Kazakhstan whose market ended the year up by just over six-and-a-half percent. One of the main factors behind this growth was due to the 18% increase in the volume of foreign investment in 2018.
Another talking point during the year was the commencement of Moscow Exchange (MOEX) trading the KASE Index Exchange Traded Fund (ETF). The ETF comprises of the seven largest Kazakh equity issuers, including Ban CenterCredit, KAZ Minerals and KazTransOil.
Also read: 2018’s Worst Performing Frontier Markets