182-Day treasury rate drops marginally
The 182-day treasury security rate decreased by two basis points to settle at 24.69 per cent. All other treasury securities maintained their respective yields at the close of the week.
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The government accepted all GH¢1,369.55 million worth of bids tendered at the auction held on Friday September 2, 2016. The total amount however exceeded the GH¢1,138.00 million targeted by government for the week.
The government’s target for the 91-day and 182-day treasury securities at the next auction on Friday, September 9, 2016 is GH¢721 million, while the Two-year note is GH¢300 million.
Though, the 182-day treasury instrument declined marginally, it was not significant to achieve a regular yield curve. The government effort at restructuring its debt structure towards long-dated instruments was weakened as investor preference towards short and medium term dated instruments were heightened as their risk and return expectations for the long-dated instruments were not adequately met.
Ghana Stock Exchange
The Ghana Stock market improved on its performance as top-weighted financial sector stocks made price gains last week. The GSE-Composite Index gained 1.47 points at the close of the trading week to settle at 1,810.04 points while the GSE-Financial Stock Index eased by 4.57 points to close at 1,718.57 points.
The GSE-CI and the GSE-FSI ended the trading week with year-to-date losses of 9.27 per cent and 10.96 per cent respectively.
The week’s trading volume increased by more than 200 per cent relative to the previous week. At the close of last week’s trading, a total number of 467,892 shares valued at GH¢62,847.81 exchanged hands on the stock market.
UT Bank emerged as the most actively traded stock contributing 57.99 per cent of the total trading volume. Ecobank Ghana Limited and GCB Bank Limited led the stocks in terms of trading value, accounting for 52.2 per cent and 26.3 per cent of the total value of stocks traded respectively.
Market capitalisation, however, declined by 0.37 per cent to close the week at GH¢53,658.28 million.
The first trading week of September saw price gains in five stocks and losses in eight other stocks. Ecobank Ghana Limited, Ecobank Transnational Inc and PZ Cussons added a pesewa apiece to trade at GH¢6.88, 16 pesewas and 21 pesewas per share respectively.
HFC Bank gained four pesewas to settle at 75 pesewas per share while Fanmilk Limited appreciated by 24 pesewas to end the week’s trading activities at GH¢9.74 per share.
On the side of the losers, GCB Bank, Aluworks and SIC trimmed 1 pesewa to trade at GH¢4.00, 13 pesewas and 16 pesewas per share respectively. Cal Bank and Enterprise Group Limited shed 2 pesewas apiece to end the week at 85 pesewas and GH¢2.36 per share respectively. UT Bank lost two pesewas to trade at five pesewas per share.
Tullow Oil Plc and Ghana Oil Limited lost 45 pesewas and nine pesewas respectively to end the trading week at GH¢27.20 and GH¢1.24 per share concluding the list of laggards.
Currency
On the currency market, the US dollar traded flat against the Ghana cedi amidst mixed economic data resleased in the US. The greenback pitched its year-to-date gains against the local currency at 3.99 percent as the US jobless claims increased by 2,000 in the week ended August 26, 2016 while the US consumer confidence index climbed to 101.1 in August 2016 from the record of 96.7 in July 2016, reaching the highest since August 2015.
The British Pounds Sterling edged up by 0.86 per cent against the local currency as data from Markit/CIPS purchasing managers index disclosed that the UK manufacturing sector rebounded sharply in August with retail sales rising by 5.9 per cent.
The gauge of manufacturing activities in the private sector rose from a 41-month low of 48.3 in July to 53.3 in August. The pound appreciated to lessen its year-to-date losses against the local currency to 6.65 percent as reports show signs of inflation in the UK.
The Euro declined by 0.88 per cent versus the Ghana cedi as economic outlook in the Eurozone looked frail. The local currency posted marginal gains last week against the Euro as highlights from the Eurozone Manufacturing PMIs showed contractions in economic activities in the Euro area.
The Economic Sentiment Indicator (ESI) in the Eurozone weakened from 104.5 in July to 103.5 in August, 2016.
Commodities
Crude oil ended lower last week despite boosts from the weaker US dollar. Brent crude prices declined to trade at US$46.67 per barrel on the international commodities market as doubts over the potential for crude production freeze persisted.
The black gold tumbled as crude inventories in the US rose by 2.3 million barrels to in the week ended August 26, 2016 to further aggravate the oversupply concerns that have pressured down crude prices for close to two years.
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Gold prices rebounded to trade at US$1,327 per ounce as the fall in the greenback and the U.S manufacturing activity provided support to the yellow metal. Gold prices staged a modest rebound after suffering their largest weekly decline since mid-July as traders wait for clues on the central bank’s plans for interest rates.
Cocoa declined by 3.81 per cent to trade at $2,900 as most traders liquidated their long positions a profit taking activities. The bearishness in cocoa was exacerbated as traders’ digested downbeat news on the changing weather condition in top growing, West Africa that could hurt the development of the soft commodity.
Coffee prices rallied 4.52 per cent to close at the week at US$1.51, buoyed by improvement in technical outlook and concerns about early flowering of crops in top producer Brazil.
The soft crop trended northwards despite the surging Brazilian Real following the impeachment of President Dilma Rouseff. – IGS Financial Services/GB
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