Colombo stock market produces sharp rebound

The Colombo stock market yesterday produced a strong rebound with both indices gaining sharply on positive news of breakthrough in external debt restructuring.

The active S&P SL20 Index shot up  by 3.14%  and the benchmark ASPI improved by  1.38%. Turnover was Rs. 1.24 billion involving 73.3 million shares.

Asia Securities said after two sessions of losses, the indices staged a strong rebound on Tuesday and recorded their biggest single-day gains since 30 November 2022, on the back of a sharp pick up in EXPO (+11.9%), LIOC (+8.5%), BIL (+6.3%), LOFC (+8.7%), and ACL (+8.2%).

However, SCAP and AAIC continued their downward trend declining 11.3% and 8.7% respectively. The ASPI gained 114 points (+1.4%) during the session while the S&P SL20 outperformed the broader index with a 79-point gain (+3.1%).

As the biggest index mover, EXPO contributed 46 points to the ASPI, followed by LIOC (18 points), and BIL (10 points).

Turnover was supported by SCAP (Rs. 246 million), AAIC (Rs. 168 million), and EXPO (Rs. 152 million). The breadth of the market was almost neutral with 82 price gainers and 88 decliners.  

Foreigners recorded a net  outflow of Rs. 41.6 million. Net foreign buying  topped in BIL at Rs. 4.3 million and selling topped in LOFC at Rs. 48.8 million.

First Capital said commencing the week, ASPI reverted to the green zone while recording the highest intraday gain in one-and-a-half month, boosted by the speculation on India likely to support Sri Lanka’s debt restructuring plan which provides the confidence of finalising the IMF program in the 1Q2023.

In response to that, investor interest was witnessed in Banking counters while retailers pounced on battered stocks (mainly EXPO and LIOC) after a steep fall during the past few days. Accordingly, the index started on a solid footing and continued to move up and closed the day on a positive note at 8,376, gaining 114 points.

NDB Securities said high net worth and institutional investor participation was noted in Hatton National Bank. Mixed interest was observed in Expolanka Holdings, Softlogic Life Insurance and Lanka IOC whilst retail interest was noted in Browns Investments, Softlogic Capital and LOLC Finance.

The Insurance sector was the top contributor to the market turnover (due to Softlogic Life Insurance) whilst the sector index lost 1.79%. The share price of Softlogic Life Insurance lost Rs. 9.25 (8.67%) to close at Rs. 97.50.

The Diversified Financials sector was the second highest contributor to the market turnover (due to Softlogic Capital and LOLC Finance) whilst the sector index increased by 1.62%. The share price of Softlogic Capital decreased by Rs. 1.80 (11.32%) to close at Rs. 14.10. The share price of LOLC Finance appreciated by 60 cents (8.70%) to close at Rs. 7.50.

Expolanka Holdings and Browns Investments were also included among the top turnover contributors. The share price of Expolanka Holdings moved up by Rs. 20.50 (11.92%) to close at Rs. 192.50. The share price of Browns Investments recorded a gain of 40 cents (6.35%) to close at Rs. 6.70.