Cocoa loan boosts Cedi prowess

In spite of positive developments in the US, the dollar closed positive on the international forex front but lost against the local currency in the domestic market due to the supply boost to the cedi.

The cedi thus appreciated by 0.30 percent to trade at GH¢4.39 per dollar, representing a year-to-date depreciation of 4.62 per cent.The 19-bloc currency was weighed by post-election uncertainties and low macro-economic data readings from the Eurozone.

The difficulties surrounding Angela Merkel in forming a coalition government after her win in the recent general election in Germany dimmed investors sentiment and that sparked series of profit taking activities among investors. These factors took the shine of the 19-bloc currency, causing it to lose 1.25 per cent against the local currency.

The cedi thus traded at GH¢5.9 per euro, reducing its year-to-date depreciation to 13.47 per cent.

UK’s Brexit secretary – Barnier’s comment that a considerable progress is made in connection with the Brexit negotiation, an indication that a conclusion may be achieved sooner, buoyed market sentiment and stimulated demand for the pound sterling among currency traders. The surprise boost of the pound was also by upbeat retail sales data which settled at 42 points in September from a negative 10 points in August.

In spite of the pound’s positive outlook, the currency failed to steady against the local currency, which was supported by the recent inflow.

The cedi thus appreciated by 1.61 per cent to trade at GH¢5.19 per pound, representing a year-to-date depreciation of 17.07 per cent.

Treasury securities

At the end of September 29 auction, the yields on the short-dated Treasury Securities eased marginally.

Yields on both the 91-Day and 182-Day T-Bills softened by nine basepoints (bps) each to settle at 13.15 per cent and 13.97 per cent, respectively. The yields on all other treasury securities remained unchanged.

Out of the total of GH¢914.29 million tendered, the government accepted GH¢878.59 million worth of bids.

This was 9.23 per cent lower than the week’s target of GH¢968 million. Comparatively, the short-term securities accounted for most of the purchases made, with the 91-day and 182-day Treasury Securities constituting 87.92 per cent of the total bids accepted.

Target for the next auction is estimated to be GH¢676 million for both the 91-day and 182-day Treasury Securities and GH¢200 million for the Two-Year note.

The regularity of the yield curve was maintained amidst the rate adjustment observed on the Treasury Securities.

The normality of the yield curve, coupled with recent upbeat economic data, including consumer sentiment, is expected to brighten the economic fortunes of the country through a deepening of the private sector participation in economic growth.

Stock market

September 29’s price gain in Ecobank Ghana Ltd significantly supported the Ghana Stock Exchange (GSE) to prevent a further fall this week.

In spite of most trading sessions ending in the red, the GSE Composite Index upticked by 1.51 per cent to settle at an index level of 2,326.09 points, representing a year-to-date return of 37.71 per cent. The Financial Stock Index rebounded by 2.24 per cent to close at an index level of 2,043.51 points, corresponding to a year-to-date gain of 32.23 per cent.

At the close of the trading week, a total volume of 2.83 million shares valued at GH¢6.32 million was recorded as compared with the 1.55 million volume of shares worth GH¢1.56 observed in the previous trading week.

Top five gainers in terms of volume were CAL Bank Ltd, GCB Bank Ltd, Societe Generale Ghana Ltd, Enterprise Group Ltd and Ghana Oil Company Ltd. They accounted for 90.23 per cent of the total traded volume. Market capitalisation appreciated by 1.07 per cent to settle at GH¢58.38 billion.

Price movements

Fourteen equities changed price in the week’s trading. Ecobank Ghana Ltd topped the advancers with a GH¢1.05 gains to trade at GH¢8.05 per share.

Benso Oil Palm Plantation continued to enjoy investors choice throughout the trading session, rising by 14 pesewas to close at GH¢5.80 per share.

Ghana Oil Company Ltd and Guinness Ghana Brewery Ltd shares increased by three pesewas and two pesewas to trade at GH¢2.36 and GH¢1.52 per share respectively. Ecobank Transnational Incorporated and HFC Bank Ltd had their share prices raised by two pesewas each to settle at 18 pesewas and GH¢1.39 per share respectively.

Sam Woode Ltd also advanced by a pesewa to trade at five pesewas per share.

On the flip side, Access Bank Ghana Plc closed as the worst laggard, after losing 60 pesewas to trade at GH¢3.40 per share.

This was keenly followed by Enterprise Group Ltd which tumbled by 42 pesewas to close at GH¢4.08 per share.

Standard Chartered Bank Ltd and GCB Bank Ltd trimmed 19 pesewas and 13 pesewas to trade at GH¢19.71 and GH¢4 per share, respectively. Fan Milk Ltd also went down by 10 pesewas to close at GH¢19.80 per share.