CSE gathers more momentum, net foreign inflow

The Colombo stock market gained further momentum yesterday to reach a month-high on the strength of renewed local investor optimism.

The active S&P SL20 gained by 1.1% and the benchmark ASPI by 0.6%. Turnover was Rs. 1.8 billion involving 77.3 million shares. CSE also saw a gain net foreign inflow.

Asia Securities said the market continued its upward momentum driven by banking stocks as investors capitalised on the recent price declines. 

The ASPI surged past the 11,000 level in mid-day trading, led by MELS (+4.6%), SAMP (+3.1%), COMBN (+2.2%), HNBN (+2.4%), NTBN (+2.7%), DFCC (+3.3%), and FCT (+1.4%). Nevertheless, the market’s momentum in the latter half of the session due to price losses CALT (-1.6%), BIL (-3.7%), CFVF (-2.0%), EXPO (-1.5%), and SLTL (-1.0%). Notably, ACL (+1.7%) saw increased buying activity during the session on earnings expectations. MELS (+18 points), SAMP (+17 points), and COMBN (+12 points) were the key index drivers during the session while CINS (-16 points) ended as the biggest laggard on the ASPI.

Market activity continued at improved levels with turnover led by JKH (Rs. 704 mn), SAMP (Rs. 171 mn), and CALT (Rs. 108 mn).

Asia also said foreign participation in the market remained bullish resulting in a net inflow of Rs. 254 mn on continued foreign purchases in JKH for a second straight session (Rs. 152 mn). 

Over the past two days, foreigners have generated Rs. 555 mn in net inflows. 

First Capital said the Bourse rallied for the third consecutive day supported by the recovery in corporate earnings and the continuous decline in interest rates at the weekly T-Bill auction. Accordingly, investor activity was mainly centred on the Banking sector which drove the market. Hence, the index started off on a solid footing and maintained its steep upward trajectory, reaching an intraday high of 11,020 before closing the day at a one-month high of 10,938, gaining 66 points. Buoyed sentiment on MELS extended for yet another day, which positively backed the index following the announcement of the first interim dividend of Rs. 4.27 per share.

On the other hand, JKH observed notable collections from both retail and foreign investors, with the latter recording a net foreign purchase of Rs. 151.8 mn for the day.

NDB Securities said high net worth and institutional investor participation was noted in John Keells Holdings, Sampath Bank and Windforce. Mixed interest was observed in Browns Investments, Capital Alliance and Lanka Milk Foods whilst retail interest was noted in SMB Leasing voting and nonvoting, LOLC Finance and First Capital Holdings.

The Capital Goods sector was the top contributor to the market turnover (due to John Keells Holdings) whilst the sector index gained 0.64%. The share price of John Keells Holdings increased by Rs. 1.50 to Rs. 195.75.

The Banking sector was the second highest contributor to the market turnover (due to Sampath Bank) whilst the sector index increased by 2.16%. The share price of Sampath Bank gained Rs. 2.10 to Rs. 69.10.

Capital Alliance, Browns Investments and Lanka Milk Foods were also included amongst the top turnover contributors. The share price of Capital Alliance moved down by one Rupee to Rs. 63.30. The share price of Browns Investments recorded a loss of 20 cents to Rs. 5.20. The share price of Lanka Milk Foods appreciated by one Rupee to Rs. 185.75.