Stock market opens fresh week on a dull note

The Colombo stock market began a fresh week on a dull note with indices moving down amidst low turnover. 

The benchmark ASPI declined by 0.33% and the active S&P SL20 by 0.54%. Turnover was Rs. 2.25billion involving 60.16 million shares.

Foreign participation in the market activity remained at subdued levels with foreigners closing as net sellers. Foreigners recorded a net outflow of Rs. 115.89 million.

First Capital said bourse extended price declines and dull sentiment as retailers preferred to book profits on index heavy weights and banking sector counters as CBSL directed all licensed banks to reduce rates on all lending products by at least 250bps by 31 October 2023, which may result in a contraction of interest spreads.

“As the weighted average yields at the T-Bond auction surged, ballooning selling pressure on Banking and Treasury counters further dragged the index down to close the day at a 1-month low of 11,170, losing 37 points. Furthermore, selling pressure on the poultry counters further pulled the index down amidst the price reduction imposed on a kilo of chicken by Rs 100 with immediate effect,” it added.

However, First Capital said retail interest in the hotel sectors continued yet another day on the back of a boost in tourist arrivals. “In the midst of lackluster investor participation, turnover was recorded at LKR 2.3 billion, remaining below 36% cf. monthly average turnover of Rs 3.5 billion. Contributed by JKH and CDB through off-board transactions, capital goods and diversified financial sectors collectively accounted for 42% of the market turnover,” it added.

NDB Securities said the ASPI closed in red as a result of price losses in counters such as Sampath Bank, Central Finance Company and Hayleys with the turnover crossing Rs 2.2 billion. Similar behavior was witnessed in the S&P SL20.

It added that high net worth and institutional investor participation was noted in John Keells Holdings, Asian Hotels and Properties, and Citizens Development Business Finance.

Mixed interest was observed in Hatton National Bank, Capital Alliance and Ceylon Grain Elevators whilst retail interest was noted in Tess Agro, Browns Investments and Pan Asia Banking Corporation.

Capital Goods sector was the top contributor to the market turnover (due to John Keells Holdings), whilst the sector index lost 0.33%. The share price of John Keells Holdings declined by Rs. 1.25 (0.68%) to close at Rs. 181.25.

Diversified financial sector was the second highest contributor to the market turnover (due to Citizens Development Business Finance and Capital Alliance) whilst the sector index decreased by 0.80%. The share price of Citizens Development Business Finance closed flat at Rs. 191.00. The share price of Capital Alliance declined by Rs. 5.20 (6.43%) to close at Rs. 75.70.

Asian Hotels & Properties and Hatton National Bank were also included amongst the top turnover contributors. The share price of Asian Hotels & Properties gained Rs. 0.80 (1.52%) to close at Rs. 53.50. The share price of Hatton National Bank recorded a loss of Rs 1.00 (0.57%) to close at Rs. 173.50.