CSE turnover slumps to over 3 month low, ASI six month low

The turnover at the Colombo stock market yesterday plunged to lowest since mid-March level of Rs. 845 million whilst benchmark index ASI dipped to a six month low.

NDB Stockbrokers said Tthe week kicked off with unimpressive turnover levels, while indices also ended in red.

“However, it was heartening to see rekindled interest in fundamentally strong stocks. While not much selling was witnessed, taking a break from a run of forced and panic selling, institutional buying seemed to be active,” it added.

Bank, Finance and Insurance sector was the main contributor to the market turnover (due to Seylan Bank – Non-voting, Swarnamahal Financial Services and Central Finance), while the sector index decreased by 0.40%. Swarnamahal Financial Services shed Rs 3.40 (4.32%) and closed at Rs.74.10.

Manufacturing sector also contributed significantly to the market turnover (due to Royal Ceramics and Blue Diamonds Jewellery Worldwide). The sector index decreased 0.92%. Royal Ceramics was the main contributor to the market turnover while 419,700 shares of the company exchanged hands at Rs 155.50. The share closed at Rs 154.00 having dropped Rs 3.50 (2.21%). Blue Diamonds gained Rs 0.50 (5.81%) and closed at Rs 9.10.

John Keells Holdings also contributed significantly to the market turnover. 100,000 shares of the company exchanged hands at Rs 207.00 each.

Reuters said stock market fell to six-month low on Monday with turnover too slumping to its lowest this year  due to a cash crunch as large amount of money is locked in private placements and initial public offerings.

Sri Lanka’s main share index fell 0.41 percent or 27.97 points to 6,816.74, to its lowest close since Jan. 6.

The day’s turnover was 845 million rupees ($7.7 million), its lowest since Dec. 17, well below last year’s average of 2.4 billion and this year’s daily average of 2.82 billion.

Since June 1, it has shed 8.1 percent mainly due to forced selling, in line with the policy of the regulator Securities and Exchange Commission (SEC) to recover credits, aiming to eliminate all credit dealing by end 2011.

Over 6 billion Sri Lankan rupees has been still locked up in the two recent initial public offerings.

 On Monday, the SEC’s Director General Malik Cader said there may be over 30 billion rupees of liquidity locked in private placements and IPOs since February this year.

The bourse is still up 2.73 percent so far this year. It was the top performer in the Asia-Pacific in 2010 and 2009 with 96 percent and 125 percent returns, respectively.

 Foreign investors were net sellers of 21.9 million rupees worth of shares on Monday, and have sold a 7.57 billion rupees in 2011 after a record 26.4 billion in 2010.

 Traded volume was 56.6 million, against a five-day average of 70.5 million. The 30-day and 90-day average trading volumes were 180.5 million and 103.6 million, respectively. Last year’s daily average was 67.9 million.

The rupee closed flat at 109.49/50 a dollar. A state bank sold dollars at a steady rate of 109.50 despite importer demand for the greenback, dealers said.