Demand Soars, Market Index Marks Time At Stock Exchange

Accra, Ghana (PANA) - Guinness Ghana Limited sold 1,135,400 shares when trading resumed Monday to lift total shares traded from 294,300 Friday to 1,152,600.

However, the Ghana Stock Exchange All-Share Index marked time, as there was no change in the price of any equity.

David Abbey, a broker with Databank Brokerage Limited, said that the huge trade was due to cross-trading that involved offshore investors.

Cross-trading is the situation where the same broker makes the offer and the purchase at the same time.

Even though Guinness Ghana Limited recorded a last price of 975 cedis, Abbey said the 1.1 million shares that changed hands went for 1,050 cedis.

He said the sale was possible because Guinness Ghana Limited has not exceeded the 74 percent share quota to non- resident foreign investors.

Under normal circumstances, when a company exceeds the quota, its shares must have been displayed on the bourse for three consecutive trading days before it can be offered to a non-resident foreign investor.

So far, only Standard Chartered Bank, Paterson Zochonis, and Uniliver have exceeded their quota "because they form part of the few blue chip companies the country boasts of."

Asked about the low volumes recorded in recent times, Abbey said: "Trading is generally low because foreigners cannot freely participate in the equities of their choice due to the 74 percent quota."

He added that lack of education on the essence of investing on the bourse and the economic situation continues to be a disincentive to local investors.

On the general level, the exchange did not record any price change, resulting in the All-Share Index marking time at Friday's close of 812.57 points.

Offers, however, increased by one million from two million to three million with demand soaring to a high of 1.1 million from 302,500 on the strength of Guinness Ghana Limited.

Market capitalisation remained at 3,556.59 billion cedis.

In the broader market, there was no price change with 13 of the 23 listed equities registering negative pressures.

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