South Africa is feeling the real impact of the rising numbers of the covid-19 pandemic in both its communities and economy.
The JSE is focused on ensuring the health and wellbeing of its people at all times. In line with World Health Organisation (WHO) guidelines and national government, the JSE proactively implemented several precautionary measures to ensure that its employees are able to work safely and enable continuous trading in its capital markets.
The JSE is of the view that the most prudent approach is to keep markets open to enable all market participants to conclude transactions in accordance with their investment decisions and strategies. The JSE will, unless unforeseen or exceptional circumstances arise, maintain its usual business operations and market hours to allow all investors to fully participate in the JSE’s markets.
“A fundamental part of running a fair market is to enable free market forces to play out. Our role at the exchange is to ensure that we run orderly and fair markets, allowing companies access to capital and investors to trade in these volatile times,” says Leila Fourie, Group CEO of the JSE.
The JSE’s role as a critical financial markets infrastructure in South Africa, is focused on ensuring the continued availability of its systems and it has worked extremely hard to ensure that there has, to date, been no disruptions to any of its operations. Over the past two weeks, the JSE has experienced extreme market volatility and unprecedented volumes. That being said, the JSE’s robust systems and committed market participants have ensured uninterrupted trading, clearing and settlement in all the securities listed and traded on its various markets.
The JSE is working closely with regulators, suppliers, members and various stakeholders in the capital markets ecosystem to ensure an integrated approach to contingency plans to safeguard integrity, continuity and uninterrupted access to the markets. The exchange has engaged with critical service providers and market participants to confirm business continuity plans and remote working capabilities to ensure system continuity and functionality in the event of an escalation in the pandemic locally. The JSE is also closely monitoring capital adequacy and liquidity of market participants to ensure settlement and therefore investor protection.
The JSE has additionally widened its circuit breaker trigger points. Circuit breakers trigger temporary halts in trading of securities during market volatility to provide investors with a brief pause to better understand market conditions and make, or adjust their trading decisions accordingly. The JSE has circuit breaker triggers on an instrument (stock or contract) level, which enforce temporary trading halts for periods of 5 minutes at a time. “This is a difficult time for global markets, communities and families all over the world. My concern is around what happens after this volatility has passed, the impact on the real economy and how this filters into our capital markets. As we attempt to make sense of and quantify the unknown, we will continue to engage with various stakeholders, our colleagues in government and broader business to find solutions as we together tackle the impact of covid-19,” concludes Fourie.