WEEKLY MARKET WATCH SIC-FSL INVESTMENT+ RESEARCH| MARKET REVIEWS|GHANA 8th January, 2015 STOCK MARKET ACCRA BOURSE MAKES PROMISING START INDICATORS WEEK OPEN WEEK END CHANGE The year 2014 has begun living up to expectations as bullish runs in equities from the petroleum, finance and consumer Market Capitalization (GH¢ goods sectors saw the annual returns of the broader market 'million) 64,352.42 64,229.12 -0.19% Market Capitalization (US$' inch up to 0.42% last Thursday. Though, most equities gave million) 20,109.50 20,014.06 -0.47% up their opening prices, rise in the market value of Ghana Oil Petroleum Company Limited (GOIL), Societe Generale Ghana Volume traded (shares) 783,118.00 573,274.00 -26.80% Table 1: Market Summary Limited (GOIL) and Fan Milk Limited (FML) were enough to close the week’s activities on a positive note. Key benchmark indices closed the week better despite slight volatilities during inter-day trading. The GSE Composite INDEX ANALYSIS index closed at a year-to-date return of 0.42% whiles the GSE Financial Stocks Index settled at 0.67% returns. INDICATORS Closing Week YTD Level Change CHANGE Total market capitalization of the Ghana Stock Exchange was GH¢64.23 billion, an equivalent to USD20.00 billion. GSE Composite Index 2,270.57 0.42% 0.42% GSE Financial Stocks Index 2,258.77 0.67% 0.67% Table 2: Key Stock Market Indices LIQUIDITY The absence of block trades over the period saw liquidity comparatively down last week. All in all, an approximate figure of 573,274 shares exchanged hands within the first trading week of the year, and was also valued about GH¢2.48 million. This represented 26.80% increase over its last trading week in the last trading week in December 2014. MARKET MOVERS Investors show interest in FML’s share Fan Milk Limited (FML) made the biggest gain on the exchange STOCK Wk Open Wk End Change % TICKER change following an appreciation of 8.76% in last week. The rise might have been due to the prospects investors foresee in the company. FML 5.25 5.71 0.46 8.76% FML over the years has been one of the active stocks on the Ghana GOIL 1.05 1.06 0.01 0.95% Stock Exchange (GSE) and again a safe haven stock for most market players. SOGEGH 1.00 1.06 0.06 6.00% Table 3: Gainers for the week FML at GH¢5.71 per share, still remains technically undervalued as investors consolidate their holdings to enjoy future dividends in the company. The company started the year at GH¢5.25 per share, but has since increased sharply to GH¢5.7 with just a week into the year. Investors increase SOGEGH value STOCK Wk Open Wk End Change % TICKER change Societe Generale Ghana (SOGEGH) was the second best performing stock on the Accra Bourse last week, following 6.00% EBG 7.60 7.58 -0.02 -0.26% rise in market value. The rise could be attributed to the Bank’s EGL 1.75 1.74 -0.01 -0.57% financial prowess in third quarter last year. SOGEGH reported an increase of 45.23% in net profit after tax Q3’14 over its ETI 0.28 0.27 -0.01 -3.57% comparative period previously. GCB 5.82 5.71 -0.11 -1.89% At the current price of GH¢1.06 per share, the stock is trading at a PZC 0.30 0.24 -0.06 -20.00% trailing P/E ratio 7x at par with the sectors average ratio, and a SCB 20.35 20.15 -0.2 -0.98% price-to-book ratio of 2x. This appeared to have boosted investor confidence in the stock, as they step up bids for the bank’s shares. SIC 0.37 0.36 -0.01 -2.70% GOIL picks 1-pesewa UTB 0.25 0.24 -0.01 -4.00% Table 4: Laggards for the week Ghana Oil Company Limited (GOIL) made a pesewa rise in value, to close the week at GH¢1.06 a share, representing an annual yield of 0.95%. GOIL at its current price above, still remains most pick within the sector and might be due to the stock’s relatively low trailing P/E ratio of 12x compared to sector’s average of 17x. CORPORATE NEWS THE GENERAL MANAGER OF FIRST ATLANTIC BROKERS RESIGNS: The General Manager of First Atlantic Brokers Limited, Mr. Kofi Osafo Sampong has resigned with effect from January 01, 2015. According to the management, the company is still looking for replacement and the investing public will be notified when a new manager is appointed. Stock Ticker Year Opening Closing Price @ YTD Gain/Loss (%) Price(GH¢) 8/1/2015 (GH¢) African Champion Industries Ltd. ACI 0.02 0.02 0.00% AngloGold Ashanti Ltd. AGA 37.00 37.00 0.00% Aluworks Limited ALW 0.02 0.02 0.00% Ayrton Drug Manufacturing Ltd. AYRTN 0.18 0.18 0.00% Benso Oil Palm Plantation BOPP 4.10 4.10 0.00% Cal Bank Ltd CAL 1.01 1.02 0.99% Clydestone (Ghana) Ltd. CLYD 0.03 0.03 0.00% Camelot Ghana Ltd. CMLT 0.12 0.12 0.00% Cocoa Processing Co. Ltd. CPC 0.02 0.02 0.00% Ecobank Ghana Ltd. EBG 7.60 7.58 -0.26% Enterprise Group Limited EGL 1.75 1.74 -0.57% Ecobank Transnational Inc. ETI 0.28 0.27 -3.57% Fan Milk Ltd. FML 5.25 5.25 8.76% Ghana Commercial Bank Ltd. GCB 5.30 5.71 7.74% Guinness Ghana Breweries Ltd. GGBL 3.20 3.20 0.00% Ghana Oil Company Limited GOIL 1.05 1.06 0.95% Golden Star Resources Ltd. GSR 2.34 2.34 0.00% Golden Web Ltd. GWEB 0.03 0.03 0.00% HFC Bank (Ghana) Ltd. HFC 1.50 1.50 0.00% Mega Africa Capital Ltd MAC 4.50 4.50 0.00% Mechanical Lloyd Co. Ltd. MLC 0.28 0.28 0.00% Pioneer Kitchenware Ltd. PKL 0.06 0.06 0.00% Produce Buying Company Ltd. PBC 0.12 0.12 0.00% PZ Cussons Ghana Ltd. PZ 0.30 0.24 -20.00% Standard Chartered Bank (GH) Ltd.* SCB 20.35 20.15 -0.98% SIC Insurance Company Ltd. SIC 0.37 0.36 -2.70% Starwin Products Ltd. SPL 0.02 0.02 0.00% Societe Generale Ghana Limited SOGEGH 1.00 1.06 6.00% Sam Woode Ltd. SWL 0.04 0.04 0.00% Trust Bank Ltd. (The Gambia) TBL 0.24 0.24 0.00% Total Petroleum Ghana Ltd. TOTAL 6.10 6.10 0.00% Transaction Solutions (Ghana) Ltd. TRANSOL 0.03 0.03 0.00% Tullow Oil Plc TLW 34.99 34.99 0.00% Unilever Ghana Ltd. UNIL 10.70 10.70 0.00% UT Bank UTB 0.25 0.24 -4.00% AngloGold Ashanti Depository Shares AADS 0.52 0.52 0.00% Standard Chartered Bank Preference shares SCB PREF 0.58 0.58 0.00% NewGold Exchange Traded Fund GLD 35.80 35.80 0.00% Table 5: Performance of listed equities from year open CEDI RECORDS A GOOD KICK START CURRENCY MARKET The local currency commenced the year on a good note following the composite appreciation of 1.12% it recorded against its EXCHANGE RATES BUYING SELLING YTD major trading partners on the interbank market, representing a CHANGE year-to-date appreciation of 0.90%. USDGHS 3.2076 3.2108 0.29%▼ This is prior to the public’s notice of the Government’s plans to revive bond sales this year. In a bid to tap into investors’ GBPGHS 4.8419 4.8477 2.70%▲ confidence in the coming months following IMF’s bailout, the Government plans to issue five- and seven-year bonds in the first EURGHS 3.7928 3.7964 2.60%▲ half of 2015. The country will sell two Gh¢440 million (US$136 million) of five- Table 6: Inter-bank indicative rates year bonds each in March and June and offer GH¢400 million of seven-year notes in April, as indicated on the Central Bank’s auction calendar. ▲ year-to-date appreciation ▼ year-to-date depreciation Investors hold on to the Dollar The Bank of Ghana has served notice of Government's intention to borrow GH¢25.42 billion from the domestic market within the first six months of the year. The amount is twice the GH¢12.72 billion the Government borrowed through the issuance of Government's securities in the same period last year. The news seemed to have bolstered investors’ appetite for the Dollar on the currency market as the Dollar gained 0.29% after trading at a midrate of GH¢3.2092. This signified an annual return of 0.29% in favor of the greenback. Fig 3: YTD performance of Pound, Dollar & Euro versus the Cedi Euro mimics Pound Fear of deflation heightened market expectations that the European Central Bank (ECB) will be forced to undertake bolder Pound loses to Cedi measures to support the region’s ailing economies. The Pound was under pressure on the international market as U.K’s Headline Inflation in the EU region fell to -0.2% from 0.3% year- policy makers kept the benchmark interest rate unchanged at on-year in Decembe r and even though core inflation (excluding 0.5% with no guidance for future policy direction. Investors are food & energy) remained stable, investors are expecting the ECB therefore speculating that the economic recovery of the nation is to engage in more aggressive monetary easing as soon as this not strong enough for Bank of England policy makers to raise month.