Gains in five equities failed to help the market bounce back from the previous week?s slide as declines in ten others saw the indices shed points.
The benchmark Composite Index dropped 2.35 points to 2,386.39, corresponding to a year to date return of 11.24%.
The financial Index (FSI) under pressure from six financial stocks also shaved 18.19 points to close at 2,092.75. This brings its year to date return to 17.14%.
Movers and shakers
Demand for Total Petroleum and HFC Bank shares resulted in gains this week. Total Petroleum leaped from GH?5.94 to GH?6.50 while HFC added 7GHp to GH?1.20. Ghana Oil added 2GHp to close at 81GHp. Ecobank Transnational Incorporated and Fan Milk also ended the week up by a pesewa each to 23GHp and GH?7.45 respectively.
On the flip side, Ecobank continued to drift downward as it lost 35GHp to GH?7.15. Benso Oil Palm and Stanchart also shed 9GHp and 7GHp respectively to GH?3.01 and GH?19.98. Guinness Ghana, CAL Bank and Mechanical Lloyd shaved 2GHp each on the back of selling pressure to GH?5.90, 0.98GHp and 35GHp respectively.
The week also saw four equities losing a pesewa each. Ghana Commercial Bank and Enterprise Group eased to GH?4.09 and GH?2.39 respectively while PZ Cussons and UT Bank closed at 63GHp and 43GHp respectively.
Trading Activity
The week under review saw a total of 4.87M shares valued at GH?7.33 million being recorded. HFC Bank, Ghana Commercial Bank, Ayrton Drugs, Enterprise Group and SIC Insurance were the most traded equities.
Outlook
We expect the market to respond positively to the impressive year end results and dividend payment announcement by Ecobank Ghana. Demand for shares of Total Petroleum, SIC Insurance, Ghana Oil and HFC Bank may help steady the bourse. Stanchart, UT Bank and Guinness Ghana may come under selling pressure.
Ecobank Ghana?s profit after tax hit GH?190.63M in 2013.
The audited financial statement released yesterday showed a 44% increase in the Bank?s PAT from?GH?132.56M recorded in 2012.
The bank?s?Interest Income edged up significantly to?GH?473.56M, this resulted in an improved net income of GH?389.55M in 2013, 44% over the previous year?s figure.
Profit before tax also grew 44% despite substantial increases in Impairment Charges (115) and Operating Expenses (26%).
Total assets reached?? GH?4.69 billion (37%); Shareholders Equity inched up to GH?560.93 (23%). Ecobank also made some strong growth in the areas of?deposits (32%) and loans advances to customers (52%).
The auction held last Friday March 21, 2014 saw all the treasury rates edging higher except the 182-day bill that slipped marginally. The Bank of Ghana?s policy direction and inflationary conditions continue to impact on rates.
The 91-day bill rose 34 basis points to 23.51% while the 1-Year and 2-Year Notes also gained 50 basis points each to 22.50% and 23.00% respectively. The yield on the 182-Day bill however lost 4 basis points to 21.21%.
The Bank of Ghana had targeted an amount of GH?612M for the auction but total bids submitted by dealers for bills and notes amounted to GH?667.11M. The Central Bank accepted GH?623.41M.
The local currency failed to rebound on the forex market as it depreciated against all the major trading currencies.
The Dollar notched gains against the Cedi this week after Federal Reserve head Janet Yellen indicated that U.S interest rates could rise early in 2015, after the Fed’s stimulus programme ends. The greenback edged by 1.99% against the Cedi to GH?2.67 on the currency market.
The euro also held up against the Cedi this week following hints from the European Central Bank to prevent deflation and maintain price stability in the Euro-zone. This resulted in the local currency shaving 1.72% against the shared currency with mid – rates on the interbank market averaging GH?3.67.
The Pound also extended its rally as U.K. retail sales increased 1.7%. This was three times more than economists forecasted in February. The Pound as a result gained 2.62% against the cedi to end the week at GH?4.44.
Against the Swiss Franc and the Rand, the Cedi depreciated by 1.63% and 4.74% respectively with rates by interbank traders at GH?3.01 and 25GHp.
Source Merban Stockbrokers Ltd
