BoG misses GH¢1.03bn bond target

Weak investor appetite greeted the Bank of Ghana’s weekly auction in the week ending July 10, causing the bank to miss its auction target by 36 per cent.The bank was aiming at raising a total of GH¢1.03 billion from the auction but got GH¢652 million, which is 36 below the target.

A weekly review of events on the market by investment advisory firm, UMB Stosckbrokers, also showed that short dated instruments declined at the auction held on July 10. However, the 1-Year and 2-Year notes remained unchanged.

The 91-day bill lost two basis points to 25.18 percent while the 182-day bill lost a basis point to close at 25.87 per cent.

The one-year and two-year notes were unchanged from the previous week’s 22.50 percent and 23 percent.

Trading on the Ghana Stock Exchange was mostly muted during the week, with bargain hunters dominating activity.

This caused six equities to close the week down. Investor desire to take position in five others resulted in their prices ticking higher.

The benchmark Composite Index shaved 46.53 points to close at 2,290.40 points, with a year-to-date return of 1.3 per cent. The Financial Stocks Index (FSI) lost 40.87 points to 2,331.87 points, representing a year-to-date return of 3.93 per cent

Ghana Oil led movers. It climbed 5GHp to GH¢1.50. Unilever, Societe Generale, Starwin Products and Total Petroleum made marginal appreciations of a pesewa each to GH¢7.53, 92GHp, 4GHp and GH¢5.31 respectively.

On the other hand, GCB Bank, and Standard Chartered Bank, which have been under selling pressure, lost 2GHp and 28GHp to GH¢4.73 and GH¢19.56 respectively.

Benso Oil Palm also gave up 71GHp to GH¢4.29. The other decliners for the week were Ecobank Transnational Incorporated, Guinness Ghana and Standard Chartered Bank.

In the week ahead, we expect bargain hunters to continue dictating trends on the bourse as a number of investors hope to close deals before the release of half year results.

GCB Bank, Ecobank Ghana, Ecobank Transnational Incorporated and SIC Insurance may close lower on the back of trends observed during the week. Fan Milk and Unilever may, however, be amongst gainers.

The local currency gained grounds on the forex market as the Central Bank’s recent intervention gave it a boost.

Improved sentiments in the economy after the International Monetary Fund (IMF) issued an optimistic statement about the progress of ongoing fiscal consolidation also gave further impetus to the cedi, which recorded a gain of 8.97 percent against the Dollar to close at an average of GH¢3.26 to the greenback.

The cedi opened the week at GH¢3.91 against the Euro and made 10.39 percent appreciation against the shared currency to close the week at GH¢3.55.

The local currency also strengthened against the Pound Sterling and the Swiss Franc rallying to GH¢5.08 and GH¢3.40 respectively. This represents an appreciation of 7.53 per cent against the British currency and 9.87 per cent against the Swiss Franc.

The South African Rand slipped by 7.76 per cent to the Cedi. Forex traders offered a mid-rate of 26GHp per Rand at the week’s close.