Accra Bourse closes on positive note

The rebound in investor activity continued this week with a rush to take positions in bargain stocks giving an edge to the indices this week.

Trading activity on the bourse thus closed the week on a positive note with gains in six equities outmuscling nine laggards.

The benchmark Composite Index (CI) on the back of the advancers added 16.44 points to 2,233.70. This brings the year to date return on the market to CI 4.13%.

The Financial Stocks Index (FSI) was also bullish leaping by 46.17 points to 2,179.54. This brings its year to date return to 21.99%.

Movers and shakers

Ghana Commercial Bank was the biggest price gainer edging up by 20GHp to close the week at GH?4.91. Guinness Ghana also bagged 12GHp to end the week GH?2.72 while ETI climbed 4GHp to 38GHp. Ecobank Ghana was also amongst the movers rising to GH?7.07 while Cocoa Processing and CAL Bank inched up a pesewa each to 2GHp and 90GHp respectively.

On the other hand, Unilever Ghana and Fan Milk were some of the key decliners for this week sliding to GH?15 and GH?4.89 respectively. Tullow Oil and HFC shaved 5GHp to GH?35 and GH?1.30; SIC was also down to 39GHp while UT Bank backtracked to 29GHp. Ayrton Drugs, GOIL and Enterprise Group completed the list to close the last session at 17GHp, 99GHp and GH?1.68 respectively.

?Movers and shakers

Trading Activity

With most investors finding matching offers at a premium for their bids, volume this week failed to match that of the previous week. Turnover, on the back of the jump in some share prices and some institutional trades exceeded the previous week?s value. In all a total of 2.10M shares valued at GH?5.58M were exchanged in twenty five equities.

Outlook

In the week ahead, we foresee bids to continue to exceed offers as most investors seek to get a foot in the door early. In this regard we expect bids for stocks like Ecobank Ghana, GCB, BOPP and ETI leading the market to sustain its recovery. Fan Milk, UT Bank and HFC Bank may however head southwards on the back of outstanding offers.

Short term treasury rates edged higher at the auction held last Friday September 05, 2014. The long term rates however remained unchanged.? The 91-Day Bill and the 182-Day Bill were up by 27 basis points and 5 basis points to 25.33% and 26.39%.

The 1-Year and the 2-Year Notes were steady at the previous week?s level of 22.50% and 23.00% respectively.

The Bank of Ghana had targeted an amount of GH?676M for the auction but it accepted GH?631.88M out of the GH?632.14 bids submitted by dealers

Indications of Ghana?s success at raising the US$1 billion Eurobond and COCOBOD?s US$1.7 billion syndicated loan gave a boost to the Cedi during the week under review.

The local currency as a result regained grounds against the Euro, the Pound, the Swiss Franc and the South African Rand. The Cedi however slipped against the Dollar.

The Cedi gave up 0.22% against the Dollar as investors? expectations that continuing improvements in the U.S. economy will lead the Federal Reserve to raise rates next year lifted the greenback. Indicative rates by traders on the interbank market averaged GH?3.20 at the week?s close.

Polls earlier in the week which pointed to higher number for Scottish Independence ruffled the Sterling during the week. The Cedi thus took advantage clawing back 0.83% against the Pound to close the week at GH?5.19.

The Cedi also improved against the Euro with concerns about the impact of the new European Union sanctions against Russia and decision by the European Central Bank to prevent deflation by cutting rates being the main impacting factors. The Cedi as a result edged up by 0.07% against the Euro with mid-rates by interbank traders hovering around GH?4.13 on Friday.

Against the Swiss Franc and the South African Rand quotes by traders on the interbank market averaged GH?3.42 and GH?0.29 on Friday. This represents gains of 0.35% and 1.89% against the Swiss Franc and the Rand during the week.

Source Merban Stockbrokers Ltd