Ghana’s financial markets recorded mixed performances during the review week, with the Ghana Stock Exchange (GSE) sustaining strong year-to-date gains, secondary-market trading in fixed-income securities increasing, and investor demand for Treasury bills easing despite continued oversubscription at the primary auction.
The cedi also recorded mixed movements against the major international currencies, appreciating against the US dollar and euro but weakening against the British pound.
On the equity market, the GSE Composite Index closed at 14,107.58 points, representing a year-to-date return of 60.86%, supported mainly by gains in the share prices of Standard Chartered Bank Preference Shares (SCB PREF), Cocoa Processing Company (CPC), Meridian-Marshalls Holdings (MMH), CalBank (CAL) and GCB Bank.
Meanwhile, secondary-market trading on the Ghana Fixed Income Market (GFIM) increased by 2.9% to GH¢13.75 billion, even as demand for government securities at the primary Treasury bill auction declined from the previous week.
The cedi’s performance was mixed, reflecting gains against two major currencies and a marginal depreciation against the pound.
Treasury bill demand declines
Investor demand for Treasury bills fell to GH¢4.27 billion from GH¢5.17 billion in the preceding week, representing a decline of approximately 17.5%.
The government had sought to raise GH¢3.798 billion at the latest auction but received bids totalling GH¢4.267 billion, resulting in an oversubscription of 12.34%, equivalent to about GH¢468.6 million above its target.
Acceptance rates varied across the three tenors, with the government accepting 89.23% of bids for the 91-day Treasury bill, 78.88% for the 182-day bill and 48.10% for the 364-day instrument.
Yields declined across all three maturities. The rate on the 91-day Treasury bill fell by one basis point to 4.61%, while the 182-day bill decreased by three basis points to 6.29%.
The 364-day Treasury bill recorded the largest decline, dropping by four basis points to 9.67%.
The lower yields indicate a reduction in the rates offered on the government’s short-term borrowing instruments during the auction.
For the next auction, the government is seeking to raise GH¢2.447 billion, below the GH¢3.798 billion target for the latest exercise.
Secondary fixed-income trading rises
Activity on the secondary fixed-income market strengthened during the week, with trading volumes rising by 2.9% to GH¢13.75 billion.
Domestic Debt Exchange Programme (DDEP) bonds dominated transactions, accounting for 66.27% of total trading activity. Treasury bills followed with a 29.52% share, while sell-buy-back transactions represented 4.01%.
Corporate bonds accounted for 0.11% of trading, with new Government of Ghana (GoG) notes contributing the remaining 0.09%.
The figures show that DDEP bonds and Treasury bills continued to account for the overwhelming majority of secondary-market activity during the period.
Cedi records mixed performance
The Ghana cedi posted mixed movements against the US dollar, British pound and euro, based on Bank of Ghana interbank mid-rates.
The local currency appreciated by 0.13% against the US dollar to close at GH¢11.65 to the dollar.
Despite the weekly gain, it remained down 10.30% against the US currency on a year-to-date basis.
Against the British pound, the cedi depreciated by 0.17%, ending the week at GH¢15.57.
Its year-to-date depreciation against the pound stood at 9.72%.
The cedi performed better against the euro, appreciating by 0.43% to close at GH¢13.04, although its year-to-date depreciation against the European currency remained at 5.89%.
Indicative open-market mid-rates were higher than the interbank rates, with the cedi closing at GH¢11.69 to the US dollar, GH¢15.68 to the pound and GH¢13.30 to the euro.
GSE maintains strong year-to-date returns
The Ghana Stock Exchange maintained a strong cumulative performance, with the GSE Composite Index closing the review period at 14,107.58 points and recording a year-to-date return of 60.86%.
SCB PREF led the market’s gainers, rising by 10% to close at GH¢0.99. Its year-to-date gain also stood at 10%.
CPC advanced by 8.57% to GH¢0.38, taking its year-to-date return to 660%, the strongest among the five leading gainers. MMH rose by 7.69% to GH¢0.14, representing a year-to-date gain of 40%.
CalBank increased by 1.37% to close at GH¢0.74, bringing its year-to-date return to 15.63%, while GCB Bank edged up by 0.07% to GH¢40.23. GCB’s year-to-date gain stood at 100.05%.
Losses among selected equities, however, moderated the market’s performance.
SIC declined by 0.20% to GH¢5, although it remained up 316.67% for the year.
Société Générale Ghana (SOGEGH) fell by 1.96% to GH¢5, with a year-to-date return of 11.36%.
Enterprise Group (EGL) dropped by 2.30% to GH¢8.50, while Ecobank Ghana (EGH) declined by 2.50% to GH¢39.00.
Their respective year-to-date gains stood at 144.25% and 56%.
Ecobank Transnational Incorporated (ETI) recorded the largest decline among the five laggards, falling by 2.58% to GH¢1.51, despite retaining a year-to-date gain of 96.10%.
Trading activity on the equities market weakened, with volumes falling by 26.66% from 16.85 million shares to 12.36 million shares.
The total value of shares traded during the week was approximately GH¢56.41 million.
Looking ahead, financial stocks and the information and communications technology sector are expected to remain important drivers of the GSE Composite Index’s performance in the coming week.
