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1.
REVIEW OF STOCK MARKET PERFORMANCE 2008
The year 2008 witnessed one of the most outstanding performances of listed equities on the Ghana Stock Exchange. Although the GSE is noted for its checkered but outstanding performances, especially in an election year, the sustained and improved performance of the Ghanaian stock market for the year in review was the best in Africa and among the very top performers worldwide in the face of global economic recession and its effects on capital markets.
 
The good performance in 2008 was buoyed by very good operating results of many of the listed companies and increased public awareness on activities of the Exchange all year through.  
 
Market activities especially in the first half of the year, were generally high with share prices increasing for most of the listed companies.   Demand and offers for shares assumed appreciable levels compared to previous years, allowing most trades to be effected, which in turn improved liquidity on the market. This performance entrenched the confidence of investors on the stock market and the belief that the best long-term investment is on the stock market. However, in the latter part of 2008, the sharp rise in crude oil earlier in the year and the world economic downturn began to bite. These two factors led to very thin volumes in the last quarter of 2008 with some shares shedding off some earlier price gains. 
 
MARKET PERFORMANCE
Index
A year to date gain of 58.06% on the index was achieved by end December 2008. The GSE All- Share index ended the year with 10,431.64 points compared to 6,599 points in 2007. This gain was well above the 24.66% interest equivalent on 91-day Treasury bills. The US dollar in 2008 rose by 24% against the Ghana cedi. [In US dollar terms, the GSE Index growth was 28%.] Therefore the market outperformed Treasury Bills, bank fixed deposits and investment in the US dollar.
 
It is worth noting that the index gained 65.02% with an all time high of 10,890.80 points in September 2008. The year to date gain of 58.06% in 2008 is also far above the year to date gain of 31.84% of 2007.
 
Market Capitalization
By December 2008, the total value of listed securities (equities and preference shares) had gone up from GH¢12.4 billion to GH¢17.9 billion, an increase of 44%. This was largely the result of price appreciations and the listing of new shares by SIC, Golden Star Resources and UT Financial Services as well as additional issues by HFC Bank Ltd, Super Paper Products Co Ltd, CFAO Ghana Ltd and Pioneer Kitchenware Ltd.
 
Turnover
The brisk business on the floor of the Exchange made a positive impact on turnover of shares traded on the Exchange. Volume traded for the year stood at 545.8million shares valued at GH¢380.35million. The value of shares traded in 2008 is the highest value traded in the history of the Exchange. The turnover figures recorded are clearly increases of 90% over the volume and 170% over the value for 2007.
 
LISTED COMPANY PERFORMANCE
Listed companies recorded improved company performances for the year under review, with a number of them making gains of above 100% with SPPC leading the pack with 203%.   Of the thirty-five companies listed, four companies made gains in share prices ranging between 104% and 203%; twelve companies made gains ranging between 100% and 10%; two company recorded gains below 10%, whiles ten companies maintained their share prices. Seven companies however, recorded marginal loses on their share prices.
 
Details of the breakdown of the 35 listed equities are as follows:
        Four (4) being SPPC, EIC, EBG and BOPP recorded gains above 100%;
        Six (6) being UNIL, FML, ETI, SIC, AYRTON and GGBL recorded 62% to 89%;      
        Four (4) being SCB, TOTAL, CAL, PZ recorded 35% to 46%;
        Four (4) being HFC, GCB, SG-SSB, GOIL recorded 3% to 15%;
         Ten (10) maintained their 2007 year-end prices;
         Seven (7) being ALW, PBC, PKL, GWEB, SPL, TRANSOL and CMLT had negative gains ranging from -5% to -14%.
 
Primary Market Activities & Listing
Primary market activities during the year were not as active as that of 2007. However, three companies completed an “offer for sale” and listed on the Exchange during the year under review. The Exchange strongly hold the belief that raising capital and listing on the stock market is a sure way of success for companies operating in Ghana.
In 2008, UT Financial Services, SIC Insurance Co. Ltd and Golden Star resources were listed on the Exchange having successfully completed the offer for sale to the general public.
 
The Bond market however did not record much activity. The value of listed
Government of Ghana Bonds on the Exchange amounted to GH¢1,509.60million whiles that
for corporate bonds was GH¢6.40million and GH¢35.00 for SCB Medium Term Notes.
 
Automation Project
The Exchange’s Automation Project was almost complete in 2008 but for a fire outbreak which halted the launching of the project. However, the GSE Depository Company became fully operational in November 2008. All other systems on the automation were tested and user training was also organized for stockbrokers.   It is expected that the Automated Trading as well as the Clearing and Settlement System will go live in March 2008.
 
Prospects for 2009
 
1)         The Ghana Stock Exchange will go live with an automated trading platform.
 
2)         Most paper share certificates of listed companies will be moved into the Depository Company as the Exchange resorts to electronic clearing, settlements and electronic book entry of shareholding records in investors’ accounts.
 
3)         In 2009, the Exchange also expects to facilitate primary market activities through encouraging and subsequent listing of potential listed companies on the Exchange. These will include equities and debt instruments.
 
4)         The Exchange will also step up its public education among the investing public throughout 2009 to ensure that the automated trading, electronic clearing and settlement as well as the depository system are widely accepted and patronized by the general public.

 
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