Locals sentiment keeps CSE negative but net foreign buying continues

The Colombo stock market continued its negative run further as investor sentiment remained besieged due to external factors and today’s Monetary Policy Review announcement. 

The active S&P SL20 Index was down by 2% and the benchmark ASPI dipped by 1.67%. Turnover was Rs. 982 million involving 51 million shares.

Asia Securities said extending their decline for a third consecutive session, the indices reached a 10-week low yesterday largely due to heavy retail and HNI selling pressure in front-line stocks EXPO, LIOC, LOFC, LOLC, BIL and HAYL. The ASPI slipped 121 points (-1.7%) to close at 7,117 while the S&P SL20 index declined 46 points (-2.0%) to end at 2,247. Turnover stood at Rs. 982 million (previous session- Rs. 916 million) led by EXPO (Rs. 274 million) and EXPO (Rs. 186 million). Foreigners remained on the buying side, recording a net inflow of Rs. 28 million led by net buying in JKH (Rs. 12 million) and REG (Rs. 10 million). The breadth of the market continued weak with 26 stocks recording price gains during the session and 142 closing lower.

Asia also said foreigners recorded a net inflow of Rs. 28 million while their participation declined to 2.1% of turnover (previous day 3.3%). Net foreign buying topped in JKH at Rs. 12.3 million and net selling topped in DIAL at Rs. 2 million.

First Capital said the Bourse further regressed to red for the third straight session with investors booking profits in heavy weight stocks while margin calls hindered investor sentiment.

It said the Index set off on a downslide shortly after the market commenced and continued on a downward trajectory throughout the session hitting an intraday low of 7,091 before closing for the day at 7,117 losing 121 points. Retail favourite counter LIOC contributed to the ASPI decline following the drop in global crude oil prices. Turnover was 9.4% below the weekly average of Rs. 1.1 billion as investors remained side-lined with expectations of a massive rate hike in tomorrow’s policy review. Moreover, turnover was led by a joint contribution of 47% from the Energy sector and Transportation sector.

However, foreign investors dominated with net buying for the third consecutive day while recording low participation.

NDB Securities said high net worth and institutional investor participation was noted in John Keells Holdings. Mixed interest was observed in Lanka IOC, Expolanka Holdings and LOLC Holdings, whilst retail interest was noted in LOLC Finance, Browns Investments and SMB Leasing.

Energy sector was the top contributor to the market turnover (due to Lanka IOC) whilst the sector index lost 5.88%. The share price of Lanka IOC decreased by Rs. 5.90 (7.31%) to close at Rs. 74.80. Transportation sector was the second highest contributor to the market turnover (due to Expolanka Holdings) whilst the sector index decreased by 2.47%. The share price of Expolanka Holdings lost Rs. 4 (2.47%) to close at Rs. 158.25.

John Keells Holdings, LOLC Finance and Browns Investments were also included amongst the top turnover contributors. The share price of John Keells Holdings moved up by Rs. 2 (1.65%) to close at Rs. 123. The share price of LOLC Finance recorded a loss of 20 cents (3.23%) to close at Rs. 6. The share price of Browns Investments declined by 30 cents (4.41%) to close at Rs. 6.50.