GHANA STOCK EXCHANGE WEEK FROM10-12-18 TO 14-12-18

THE GHANA STOCK EXCHANGE WEEK FROM 10-12-18 TO 14-12-18 PRESENTED ITSELF THE SAME AS THE WEEKS BEFORE – DOWN!

SOON I WILL NOT KNOW ANYMORE WHAT I SHOULD SAY OR WRITE AGAIN. SINCE WEEKS THE STOCK INDEXES ON THE GHANA STOCK EXCHANGE KNOW ONLY ONE DIRECTION – SOUTHWARDS.

AND ALSO CONCERNING THE REASONS FOR THE DOWNTURN I CANNOT SAY ANYTHING DIFFERENT. THEY ARE ALWAYS THE SAME DOMESTIC AND EXTERNAL REASONS WHICH ARE RESPONSIBLE FOR IT.

I DON’T KNOW WHETHER IT IS COMFORTING FOR LOCAL INVESTORS THAT EVEN THE US MARKETS HAVE GONE DOWN RECENTLY. ALL THREE – DOW JONES, S&P 500 AND NASDAQ – ARE NOW IN MINUS FOR THE YEAR 2018. I CANNOT BELIEVE IT IS COMFORTING. THIS IS ESPECIALLY SO AS THE FED WILL PROBABLY INCREASE THE INTEREST RATE AGAIN NEXT WEEK. THIS WILL PUT AN ADDITIONAL PRESSURE ON EMERGING ECONOMIES.

AS THERE IS NOTHING MUCH TO SAY ABOUT THE THIS WEEK’S PERFORMANCE, WE CAN DARE AN OUTLOOK FOR 2019.

THE FED WILL PROBABLY NOT IMPLEMENT AS MANY INTEREST HIKES ON THE U.S. ECONOMY AS IT DID IN 2018. THAT WILL LOWER THE PRESSURE ON EMERGING ECONOMIES LIKE GHANA. THERE ARE ALSO SIGNS THAT THE U.S. ECONOMY WILL SLOW DOWN IN 2019. ONE OF THE EFFECTS WILL BE THAT SOME INVESTMENT WILL LEAVE THE U.S. FINANCIAL MARKETS. PART OF THIS INVESTMENT MIGHT THEN GO INTO THE EMERGING MARKETS.

BUT BE CAREFUL: IN ECONOMY AND FINANCE YOU WILL FIND THAT TWO PEOPLE HAVE AT LEAST THREE OPINIONS. THAT MEANS THAT NOBODY CAN TELL YOU HOW THE FUTURE WILL LOOK LIKE.

FOR THE GHANAIAN MARKET THAT MEANS THAT WE CAN ONLY HOPE THAT  WE WILL SEE THE BOTTOM SOON. I SEE SIGNS THAT THE DOWNTURN WILL REVERSE IN 2019.  THE ECONOMICAL EFFORTS OF THE CURRENT GOVERNMENT WILL START TO BEAR VISIBLE FRUITS. THERE WILL BE MORE FACTORIES STARTING TO WORK IN THE VARIOUS DISTRICTS. THE  RAILWAY LINES WILL INCREASE THE TRANSPORTATION INFRASTRUCTURE. THE ENVISAGED CAR AND OTHER MANUFACTURERS MIGHT ALSO START WITH THEIR FACTORIES.

THESE DEVELOPMENTS WILL ALSO HAVE EFFECT ON THE FINANCIAL MARKETS. NON-PERFORMING LOANS WILL GO DOWN FURTHER, AND HOPEFULLY APPROACH THE 10% MARK. BANKS WILL FURTHER INCREASE THEIR LOANS TO BUSINESSES AND THE GENERAL PUBLIC. FIRST SIGNS FOR THAT WE CAN DERIVE FROM THE LAST MPC MEETING OF THE BANK OF GHANA. ALL THIS WILL ALSO PUSH UP THE FINANCIAL MARKETS IN 2019.

I KNOW THAT ALL THIS SOUNDS VERY OPTIMISTIC. BUT LOOKING AT THE DEVELPPMENTS IN 2018, I AM SURE THAT THEY LAID THE GROUND FOR FURTHER IMPROVEMENT IN 2019.

SOMETHING POSITIVE MUST AND WILL COME!

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