GSE records -16.9% return for investors in 2020; but market looks promising

by Business Zone

The Ghana Stock Exchange (GSE) returned -16.99 percent in dollar term to investors last year as the market suffered from the impact of covid-19 on the global economy as well as recovery from the financial sector crisis.

This is however better than the -20 percent return in the eight months of 2020.

The Accra Bourse witnessed an improvement in its performance in the last three months to the end of the year, as investor appetite rebounded.  This translated in an improvement in some stock prices.

The stock market had in the greater part of the year gone through some turbulent times, largely because of the negative effect of the coronavirus pandemic which compelled many foreign investors who are active players on Ghana’s stock exchange to shift their investments into gold and other safe assets.

Typically, during periods of pandemics, investors are mindful of large risk exposures of equity markets, and therefore prefer investing in assets such as gold and other minerals.

According to the weekly stock market prior to the end of the year 2020, Standard Chartered Bank, Ecobank Ghana and GCB Bank pushed up the level of the GSE-Composite Index to close the year  with a year-to-date loss of -13.98 percent in cedi term. This was far better than in the nine months of last year.

Consequently, the Market Capitalization was also boosted to end the year at GH¢54.4 billion, as against about GH¢56 billion at the beginning of the year.

On the continent, the Nigerian Stock Exchange was surprisingly the best performing stock market with a year-to-date return of 21 percent in dollar term for investors.

It was followed by the Malawi Stock Exchange and Tunisia’s TUNINDEX with annual return of 2.29 percent and 0.38 percent respectively.

The Lusaka Stock Exchange was however the worst performing stock market on the African continent with a year-to-date of negative 39 percent in dollar term.

Source: BusinessZone Online

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