The stock market started this week well notching positive gains as trading activity levels have increased, coupled with a surge in the benchmark index, following gains in Information and Communications Technology (ICT) stocks.
Major stock indexes, however, continue to produce mixed results. The benchmark GSE-Composite index advanced 0.53% on the back of gains in MTN Ghana (+1.22%) to close at 2,212.66 with a 13.96% year-to-date return to investors. According to the Ghana Stock Exchange (GSE), this index is derived based on the volume weighted average closing price of all listed stocks.
Unfortunately, financial sector stocks continue to remain stale holding the GSE Financial Stock index, unchanged at 1,873.31 with a 5.08% year-to-date return to investors. This index is computed based on listed stocks mainly from the banking and insurance sectors.
The market capitalization increased by 0.23% to settle at GH¢57.28 billion from GH¢57.15 billion recorded previously. It captures the total market value of all outstanding shares on the local bourse and can be used in determining the worth of various companies listed on the stock exchange.
Moreover, it’s simple and effective for risk assessment and as such can be helpful to investors in deciding which stocks to purchase and ways to diversify various portfolio with companies of different size, said Jason Fernando, a Value Investing Specialist.
With a boost in trading activity, a total of 7,416,123 shares valued at GH¢6,402,657 changed hands compared to 483,581 shares valued at GH¢401,376 at the last session. Again, MTN Ghana made a strong showing dominating trading activity and accounting for 86.70% of total value traded. Guinness Ghana Brewery Limited and GCB Bank Ltd also made it to the list of top trades by value.
Also, MTN Ghana witnessed a marginal price gain (0.01+) to settle at GH¢0.83, pushing its year-to-date return to 29.69% as against 28.13% previously. Other stocks that have maintained gains from the beginning of the year include Cal (15.94%), Societe Generale (14.06%), Stanchart (11.28%), GCB (11.11%) and Republic Bank (9.76%), Total (9.54%), Enterprise Ghana (1.43%) and GOIL (0.67%).
The performance of the stocks of Access Bank Ghana Plc (-2.05), Unilever Ghana Plc (-9.89%), Aluworks (-9.09), and New Gold (-4.64%) continue to remain low on the local bourse with negative returns to investors from the start of the year-to-date.
Subsequently, the arrival of vaccines coupled with a compelling market valuation, Analysts predict that this may drive the demand for stocks across the telecommunication, banking, insurance and oil sectors. Also, as companies release their full year results showing some increase in their earnings and the ability to meet short-term targets, activity levels are likely to surge on the local bourse.
Other matters arising suggests that in pursuant to regulation 15 of the GSE Listing Rules, Mechanical Lloyd PLC (MLC) is undertaking a tender offer on behalf of the Promoters, to Qualifying Shareholders to purchase all their outstanding 16,900,487 ordinary shares at an offer price of GH¢0.10 per share. This is in line with a special resolution approved by shareholders to delist the Company from the Ghana Stock Exchange.
