Cashman, Harrison and Scheiler (2014) stated that companies with less political risk will use more debts than other organisations in other countries with more exposure to political risk. In particular, when there are low political risks, there will be more leverage and when there is high political uncertainty, there will be low debts indicating a negative relationship between financial leverage and political risk (Cashman, 2015). To this effect, this study will investigate the link between capital structure and political risk in an emerging market such as Mauritius. The data sample includes 30 financial and non- financial companies listed on the Stock exchange of Mauritius over a time frame ranging from 2011 to 2015 with a total number of 135 observations. The political risk was based on two World Bank indicators, namely political change index and corruption perceptions index. Based on a panel regression model, the empirical results show an insignificant relationship between financial leverage and political risk. In particular, it is implied that there is little evidence on the importance of political risk on firms’ decision in Mauritius due to the fact that Mauritian companies consider other types of risks to be more relevant when taking on more debts. The study adds to the existing literature on emerging markets and highlights the specificity of the Mauritian equity market relative to other developed markets.

This article investigates the effects of any seasonality on stock market returns and volatility on the Stock Exchange of Mauritius. A standard GARCH model was used on daily SEMDEX returns from 1998 to 2006. The results obtained indicate that the return series are leptokurtic, indicating a higher peak and a thicker tail than a normal distribution. Also, the mean returns on Fridays seem to be the highest while average returns on Mondays turn out to be insignificant. Finally, significant effects of weekdays were found on the conditional variance on the stock returns.

The present study investigates the efficiency of the forex market based on the theory of the Efficient Market Hypothesis in Mauritius, a well-diversified and emerging economy in the African region. Hence, this study considers the case of Mauritian forex market nominal spot rate daily data namely EUR/MUR, USD/ MUR, GBP/ MUR and JPY/ MUR over a time period of 5 years ranging from 2012 to 2016. The technique used for analysis is firstly concentrated on the use of Augmented-Dickey Fuller (ADF) and Philips Peron (PP) unit root to test the weak-form of efficiency and secondly, the Johansen Cointegration Test, the Granger Causality Test and Variance Decomposition are utilized to examine the existence of semi-strong form efficiency in the Mauritian foreign exchange market. Results indicated that the unit root test tested by ADF and PP unit root test support the weak form market as it follows a random walk process. Secondly, the Johansen Cointegration test reveals that there is no long run relationships among foreign exchange variables. However, the Granger causality test confirmed the existence of unidirectional and bidirectional relationships among the various exchange rates. Moreover, the Variance Decomposition confirmed the presence of long run co-movements among the exchange rates. Therefore, both tests fail to support the semistrong form market. This means that one exchange rate can predict one or more exchange rates which is against the semi-strong form market hypothesis. Therefore, it is deduced that the foreign market is efficient in the weak-form but is inefficient in the semi-strong form in Mauritius.

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