According to the May 2022 Money Policy Report of the Bank of Ghana (BoG), the Ghana Stock Exchange Composite Index (GSE-CI) added more than 100 points in the month of May 2022.
The Ghana Stock Exchange Composite Index increased to 2691.19 points in May, 2022 from 2561.45 points that was recorded in the corresponding period of 2021, and subsequently adding 129.74 points.
However, this translates into a year-on-year gain of 5.07 per cent compared to a gain of 21.93 per cent in the same period in 2021.
According to the GSE, it relies on the GSE-CI as a measure of the performance of the Exchange. The composite index is a form of market capitalization weighted index comprising all listed ordinary shares with the exception of those of listed companies that have shares listed on other markets. Calculation of the index is based on the volume-weighted average closing price of the constituent stocks. The GSE-CI is regarded as the benchmark index of the Ghana stock market.
GSE-Financial Stocks Index
Moreover, the GSE-Financial Stocks Index (GSE-FSI) also closed at 2209.70 points, representing a gain of 17.72 per cent compared to a loss of 1.54 per cent over the same comparative period in 2021.
Ghana Stock Exchange Financial Stocks Index (GSE-FSI) constitutes only listed stocks from the financial sector including banking and insurance sector stocks. The stocks that contributed to the improvement in the financial index are: Cal Bank PLC, GCB Bank PLC, SIC Insurance Company PLC, Ecobank Transnational Incorporated, and Access Bank PLC.
The GSE-FSI is exactly like the GSE-CI but the only difference is that it has its constituents stocks from the financials sector, including those in the banking and insurance industries.
According to Bank of Ghana, the stock market’s improved performance on a year-on-year basis, was on the back of a rebound in investor confidence, underpinned by policy support, as well as the relaxation of pandemic-related restrictions, particularly in 2022.
That notwithstanding, the year-to-date performance, however, showed a loss in the index of 3.52 per cent. The main sectors that contributed to the year-to-date decrease were the Agriculture and IT sectors.
The Central Bank added that the year-to-date loss is attributed to the imposition of capital gains tax on securities listed on the GSE, the relatively higher yields on fixed income securities, higher inflation expectations, exchange rate pressures, and portfolio reversals.
Total market capitalisation of the GSE at the end of May 2022 stood GHC63.82 billion, representing a growth of 4.96 per cent (GHC3.02 billion), compared with a growth 10.15 per cent in the same period in 2021.
The year-on-year improvement in market capitalization was largely on account of capital gains. Total market capitalization, however, declined by 2.50 per cent, on a year-to-date basis, driven by declines in share prices.
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