Ghana Stocks Measure Falls Most in 3 Weeks on Bets Gain Overdone

Ghana’s stock index dropped the most in three weeks on speculation that the measure’s 27 percent gain this year was overdone. Ecobank Transnational Inc., a lender operating in 27 African nations, led declines.

The 36-member All-Share Index fell 1.4 percent to 6,990.5 by the 1 p.m. close in Accra, paring its increase this year to 26 percent, making it the worst performer among almost 90 gauges tracked by Bloomberg today. Still, the West African nation’s bourse is Africa’s third-best performer this year after Uganda’s and Kenya’s.

“The market went down today because some investors think they can reap returns at this point,” Michael Barnes, head of trading at Securities Africa Ltd., said by telephone from Johannesburg. “We are positive about Ghana’s market. About 97,000 shares traded, which is above average. This could be cash-taking ahead of Christmas.”

Ecobank Transnational, the Lome-based lender, fell 6.7 percent to close at 14 pesewas, the lowest in a week.

“The decline in the index today is due to profit-taking,” Doris Yaa Ahiati, an analyst with Accra-based Databank Group, said in a telephone interview. “The recovery of the market this year was strong and as the year gets to a close, some investors may want to reap their investments.

Ghana’s index may gain as much as 15 percent to 8,338.65 by the end of 2011 after rising to 7,251 by the end of this year as companies gain from growth linked to the start of oil output from the Jubilee field, she said. The bourse, which plunged 47 percent in 2009 to make it the world’s worst performer that year, has advanced in 2010 because of “renewing interest from foreigners” who fled investments perceived as risky during the global economic crisis, Ahiati said.

To contact the reporters on this story: Moses Dzawu in Accra at mdzawu@bloomberg.net; Ana Monteiro in Johannesburg at amonteiro4@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

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