Stock market sustains gains for second day

The Colombo stock market sustained its rebound for the second consecutive day confirming that investor sentiment is improving despite worsening economic and political crisis.

The active S&P SL20 Index gained by over 6% and the benchmark ASPI improved by 4.5%. Turnover rose to Rs. 3 billion involving 140 million shares.

Asia Securities said the indices continued on an upward trend buoyed by retail and HNI interest along with bargain buying in selected heavyweights, resulting in a higher turnover.

It said the ASPI commenced the session on an upbeat note with a gap-up of 233 points, however reversed course immediately declining to an intra-low of 7,163 (-118 points). Picking up momentum thereupon, the index returned to positive territory on the back of price gains in EXPO and LOLC group stocks, and eventually surpassed the 7,600 mark to end at 7,611.

“Over the last two sessions, the ASPI has gained more than 700 points while the S&P SL20 gained around 370 points, recovering half of their losses recorded earlier this week,” Asia said.

It said front-line stocks EXPO (+19.0%), LOLC (+26.3%), BIL (+10.7%), HAYL (+11.6%) and VONE (+17.8%) ended sharply higher on renewed buying sentiment. After eight sessions of buying, foreigners ended on the selling side, recording a net outflow of Rs. 3 million. The breadth of the market ended positive with 154 price gainers and 43 decliners.

First Capital said the Bourse thrived in the green for the second straight session as investors rallied on a buying spree fuelled by an optimistic sentiment as the World Bank agreed to grant financial aid to the country in light of the recent economic crisis.

“Initially the index opened on an upbeat note but hit a short-lived dip before starting to move on an upward trajectory. Positive momentum was persistent through the rest of the session as investors actively collected stocks from retail favourite counters such as EXPO and LOLC,” First Capital said adding turnover was at a near one month high, mainly driven by a joint contribution of 65% from the Transportation sector and Food, Beverage, and Tobacco sector.

NDB Securities said high net worth and institutional investor participation was noted in Dialog Axiata, Melstacorp and Ceylinco Insurance. Mixed interest was observed in Expolanka Holdings, LOLC Holdings and John Keells Holdings, whilst retail interest was noted in Browns Investments, SMB Leasing and LOLC Finance. Transportation sector was the top contributor to the market turnover (due to Expolanka Holdings), whilst the sector index gained 18.93%. The share price of Expolanka Holdings increased by Rs. 27.25 (18.96%) to close at Rs. 171.

Food, Beverage, and Tobacco sector was the second highest contributor to the market turnover (due to Browns Investments), whilst the sector index increased by 5.63%. The share price of Browns Investments gained 60 cents (10.71%) to close at Rs. 6.20.

LOLC Holdings, John Keells Holdings and LOLC Finance were also included amongst the top turnover contributors. The share price of LOLC Holdings moved up by Rs 86 (26.30%) to close at Rs. 413. The share price of John Keells Holdings recorded a loss of Rs. 2.50 (2.04%) to close at Rs. 119.75. The share price of LOLC Finance appreciated by 60 cents (9.68%) to close at Rs. 6.80.