2020: Record-setting year for equity and debt markets – GSE Report

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Full Year 2020 represented a record-setting year for the local equity and bonds market, according to the December report of the Ghana Stock Exchange’s (GSEs) summary of monthly activities.

Despite a financially turbulent year for most sectors of the economy, occasioned by the ongoing pandemic, the Ghana Fixed Income Market (GFIM) saw volume of trade exceed the 100 million threshold for the first time – with the equities market recording its second highest annual volume of shares traded in its 30-year existence.

In a year that saw renewed investor interest in the equities market, evidenced by the record 695,396,188 shares traded, the final month of the year – December – was responsible for 20%, with 140,376,903 shares valued at GH¢115,629,186. This represents a 21.39% and 30.04% increase in volume and value, respectively, over the previous month’s trading activities.

Cumulative value traded for the year stood at GH¢575,269, 873, representing a 108.83% appreciation over the GH¢275,468,605 recorded over the same time-frame in 2019 when the block trade conducted by ETI in 2019 is factored.

Low Price-to-Earning (P/E) ratios of stocks – typically under 5 – was touted as the most significant factor in driving trade: with MTN once again dominating, as it was responsible for approximately 78% of total volume of shares traded.

Despite the primary Index – the GSE Composite Index (GSE-CI) – gaining 6,76 percentage points over its 1,818.68 value in November to close at 1,941.59, it still represents a 13.98 depreciation from the 2019 figure of 2,257.15.

Furthermore, Market Capitilisation was 4.25% worse off as at December 2020, with GH¢54,374.88million compared to GH¢56,791.28million in 2019.

The GFIM closed the year with December setting the all-time monthly volume traded – the fifth of such in 2020 – with 13.34 billion. Valued at GH¢13.65billion, it represents a 3.08 billion or 30% increase over the previous record set in October 2020, and 33% over November.

Additionally, volume traded in December alone was 24% of the cumulative volume for the entirety of 2019, with the Year-to-date total of 108,405,308,494 representing a 95.14% appreciation over the same period in 2019.

SOURCEBy Ebenezer Chike Adjei NJOKU
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