NDK Market Updates WE Nov 29th 2019

CURRENCY, COMMODITY, AND EQUITY MARKETS UPDATE

CURRENCY UPDATE

At the end of the week, the composite loss value of the Ghana Cedi pushed the Ghana Cedi Index up by 13.1058bps to close at 482.5324 points at a YTD loss of 13.63%.

The GHS depreciated against all of its major trading currencies; USD, GBP, EUR and CFA to close at midrates of USDGHS 5.5254, GBPGHS 7.1322, EURGHS 6.0785 and GHSXOF 107.91.

At the end of the trading session for the week, the GHS had depreciated by 2.75% to the USD, to the GBP 3.25%, 2.36% to the EUR and 2.30% to the CFA

COMMODITIES MARKET UPDATE

The price of Gold declined in the week under review as the US dollar continued to strengthen. Gold closed the week at USD 1,463.97 after losing USD 4.53 from the previous week’s price. This represented a YTD gain of 14.31%.

Brent price slipped at the end of week as US rights bill fuels tensions with China. Brent decreased by USD 2.81 from the previous week’s price to close at USD 60.49/bbl at the end of the trading activity. This represented a YTD gain of 15.88%.

Cocoa ended the week at USD 2,568 after recording a USD 113 slump in price at a 6.64 % YTD gain.

EQUITY MARKET

Trading activity for the week slumped as total volume traded decreased. A total of 5.13mn shares valued at GHC 8.98mn exchanged hands at the end of the week’s trading session. This represents a 55% w/w drop in volume traded and a 503% w/w increase in value traded.

The year-to-date market index ended the week at a lower level, as the benchmark index decreased by 9.97 points to close at 2137.91 points from the previous week’s level. This represented a w/w loss of 0.46% at a 16.88% YTD loss.

EGH and SIC were the only stocks that advanced in value at the end of the week. SIC emerged the top gainer after appreciating by 12.50%.

On the contrary, stocks of MTNGH, GOIL and TOTAL lost value during the week under review with TOTAL being the top loser after shedding 2.01%.

ILL was the most traded stock in terms of volume traded at the end of the week with 6.79mn of its shares valued at GHS 4.16mn exchanging hands.

At the close of the week’s trading, there were 13 movements in prices and 36 stocks remained unchanged in prices.

Bank of Ghana introduces new Ghc200, Ghc100 notes

The Bank of Ghana has introduced GH¢100 and GH¢200 notes to the country’s currency denomination mix. It has also introduced a GH¢2 coin. This was announced by the Governor of the Central Bank, Dr. Ernest Addison at a press conference in Accra on Friday. Explaining the rationale for these new denominations, the Governor said the face value of the cedi compared to the US dollar over the past 12 years had eroded due to sustained periods of high inflation and depreciation. Read more

Mining companies resolve to deepen partnership with government

Mining companies have resolved to deepen their partnership with government in the coming year to have their concerns addressed. The Chamber of Mines says this will also ensure that government continues to create a conducive environment for mining companies to operate, while they also fulfill their obligations to the state. Among some of the concerns of mining companies over the years are the high taxes on the importation of mining inputs as well as exploration, and the poor security for miners which has resulted in attacks on mine workers. Read more

BoG sanctions staff complicit in corporate governance failures

The Bank of Ghana says it has applied sanctions to its staff whose actions led to the banking sector distress. According to the governor, Dr. Ernest Addison, this is part of an “accountability process” his outfit initiated into the corporate governance letdowns to ensure that everybody rendered individual accounts on their involvements. “There are lingering issues associated with bringing to book those who superintended over the corporate governance failures within the financial sector,” he said at the 2019 Annual Banker’s Dinner organized by the Chartered Institute of Bankers (CIB), Ghana. Read more

Finance Minister hints of possible review of benchmark import value in 2020

The Finance Minister, Ken Ofori-Atta, has hinted of a possible review of the 50 percent benchmark import value next year. Government in April this year, during the mid-year budget review, reduced the benchmark value of import duties on general goods by 50 per cent and 30 per cent on vehicles to make importation cheaper. However, stakeholders including the Association of Ghana Industries, AGI, says the move runs counter to the country’s industrialization agenda and poses major threats to local industries. Read more

INTERNATIONAL BUSINESS NEWS

AfDB approves $210 million loan for Nigeria’s power transmission project

The African Development Bank (AfDB) has approved a $210 million loan to help Nigeria upgrade its dilapidated electricity transmission and distribution network. The loan to Transmission Company of Nigeria (TCN) will support construction of 330KV double circuit quad transmission lines and sub-stations across the country, the bank said in a statement late on Friday. Read more

South African Airways shunned by insurers as financial doubts grow

Two big travel insurance companies in South Africa have stopped covering tickets issued by South African Airways (SAA) against insolvency as doubts grow about whether the struggling state-owned airline can survive. While the move is unlikely to push SAA into liquidation by itself, it will hurt ticket sales and exacerbate a cash crunch that left the airline unable to pay salaries on time this month, analysts said. Read more

Source: Bloomberg, Reuters, CNBC, Citi business news, Doobia, BOG, CSD.

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