The Ghana Stock Exchange (GSE) finished the first half of the year on a positive note as investors continued to find comfort in stocks, driving its market capitalization to an all-time high (ATH) of GH70.24 billion.
At the end of the first trading day of the second half of the year, on Monday, July 3, 2023, the indicator had increased by 0.14 per cent to GH70.34 billion. This was fueled by the June 2023 performance of the GSE Composite Index (GSE-CI), which recorded its second-highest monthly return to date.
The index, which measures the performance of the entire market, increased by 296.7 points, giving it a year-to-date (YtD) return of 14.9%. Furthermore, according to data from the Accra Stock Exchange, the GSE Financial Stock Index (GSE-FSI) increased by 14.6 points during the month, in part because some key equities in the sector recently had a rebound, cutting their losses since the beginning of the year to 17.6 per cent.
The GSE-CI increased 10.3 per cent from 2,545.48 points to 2,808.03 points compared to the first half of 2022. In a similar vein, the market capitalization increased by 8.32% from the same time last year.
In contrast, the GSE-CI ended the financial year in 2022 with -12.38 per cent, down from a high of +43.66 per cent the year before. At the time, it was one of the continent’s worst performers, as investor sentiment kept up with developments in the broader economy.
Increased investor confidence as a result of listed stocks’ success and some of them announcing dividend payment dates are not unconnected to this increase in market capitalization.
However, both the volume and value of trading activity significantly decreased. Volume and value traded fell by 87.1 per cent and 86.6 per cent, respectively, in comparison to the previous month. This decrease can be ascribed to a number of things, such as market turbulence and investor caution as elements of profit-taking gained traction.
The Cedi’s almost 20 per cent decline against the US dollar translated into a -10.1 per cent return for the GSE in US currency terms.
In response to this performance, Managing Director-GSE Abena Amoah said: “In the first half of 2023 performance and what we are seeing now is that there’s a gradual upturn in the equities market; the index is up about 14.96 per cent – almost 15 per cent, and the market cap has also crossed GH70 billion for the first time. This indicates that investors are interested in equities and are seeking diversity, which makes us extremely happy. We observe investors responding to that market because a number of our listed companies have also declared significant dividends.
Source: b&ft
