FY’23 results drive positive momentum in Ghana, BRVM markets

The Ghana Stock Exchange and BRVM markets have been experiencing positive momentum driven by the full year earnings of listed companies. Benjamin Boachi, Chief Economist at SecondStacks, recently discussed the current market outlook in an interview with CNBC Africa. Boachi highlighted that despite the challenging economic environment, companies are finding innovative ways to cut costs and maintain their earnings. He mentioned that consumer spending might not be at its strongest, but companies like MCN are still performing well. The government's efforts to alleviate pressure on corporations have also contributed to the resilience of these companies. In terms of top performers, Boachi mentioned that gold-related stocks and commodities are doing well, along with financial stocks like MCN. Gold has been rallying in the markets, and ETFs tracking commodities are attracting investors. The Ghana Stock Exchange is up 6.7% so far, showing positive performance. Boachi emphasized the importance of gold and commodity-related assets in the current market climate. Moving on to the BRVM market, Boachi discussed the performance of financials in Ivory Coast, which have been leading the market. Despite challenges in sectors like agriculture, financials have been driving the market forward. The issuance of a record-setting euro bond by Ivory Coast has provided stability to the currency and boosted market sentiment. Additionally, a recent oil discovery in the region has uplifted spirits in the market and the economy. Boachi highlighted the broad underlying strength of the market, particularly in the composite index. He noted that while typical growth drivers like the BRVM prestige index are not performing as well, there is optimism for the future in the medium to long term. Shifting focus to the fixed income market, Boachi mentioned that yields in Ghana are elevated due to ongoing debt restructuring. Cash investments in Ghana are providing investors with decent returns, reflecting the premium demanded for fixed income investments. Boachi also discussed the earnings outlook for banks in Ghana, highlighting the focus on investments with foreign exchange exposure and hedging strategies. Multinational banks listed in Ghana are seen as having better exposure to foreign currency, offering opportunities in a soft economy. As Ghana approaches an election year, Boachi expects a more stable market environment due to fiscal constraints and the country's recent IMF deal. He noted that political developments in Ivory Coast, which is also heading into an election year, are becoming clearer with notable candidates entering the race. Overall, Boachi expressed optimism for both the Ghana and BRVM markets, emphasizing the resilience and growth potential in the current landscape.