Bourse struggles with fragile recovery

The Colombo stock market continued to struggle as it posted a seemingly fragile recovery.

The benchmark All Share Index gained by 12 points or 0.1% whilst Milanka rose by over 15 points or 0.26%. Turnover however was an encouraging Rs. 1.96 billion.

“The indices edged higher with activity driven by large trades on BRWN and heavy interest on finance sector counters,” John Keells Stock Brokers said.

The market also saw a net foreign outflow of Rs. 10.2 million.

Best performing sector was Investment Trusts (+2.89%) whilst the worst was Land & Property (-1.59%)

Noting that it was a stagnant day, NDB Stockbrokers said: “Indices were mostly stagnant during the day and closed in green with renewed interest witnessed mainly in finance sector counters.” It also said negotiated deals pertaining to Brown & Company and Amana Takaful boosted the turnover levels.

Trading sector was the main contributor to the market turnover (due to Brown & Company), while the sector index decreased by 0.25%. Brown & Company was the main contributor to the market turnover with seven crossings of 2,543,400 shares at Rs 290. The share price decreased by Rs 5.70 (1.96%) and closed at Rs 285.

Banks, Finance & Insurance sector also contributed significantly to the market turnover (due to Amana Takaful and Swarnamahal Finance). The sector index increased 0.81%. The share price of Amana Takaful remained at Rs 2.20.

Profit taking was witnessed in Central Finance. Vallibel Finance announced a first and final dividend of Rs 0.50 while First Capital announced an interim dividend of Rs 2.00 per share. The share price of First Capital increased by Rs 3.50 (5.24%) and closed at Rs 22.10

Arrenga Capital said despite the volatility witnessed during mid hours of trading, both the indices closed in the green. “Institutional play on selected counters assisted to retain activity levels in the satisfactory zone,” it added.

Active investor participation in Brown & Co. and its newly listed subsidiary Browns Investments Limited led both the counters to collectively make up 39.5% of the day’s turnover. Brown & Co. saw heavy institutional participation with the counter registering 07 crossings accumulating to 2.5 mn shares being transacted at LKR290.0. Despite renewed interest in Browns Investments Limited which led the counter to gain 2.08% for the day with an intraday high of LKR5.10; the counter still closed below the IPO price.

Amana Takaful saw a parcel carrying 150 mn shares being crossed off at LKR2.00 albeit closing flat at LKR2.10. Furthermore, Softlogic Holdings & Vallibel One continued to be sought after by retail & high net worth participants. Swarnamahal Financial Services continued the momentum backed primarily by retail investors to register a price gain of 11.3% closing at LKR125.2 today. Following an interim dividend announcement of LKR2.00, First Capital Holdings saw active participation. Its related entities; Dunamis Capital & Janashakthi Insurance also attracted renewed investor attention with the counters registering price gains of 18.8%, 19.8% & 1.32% respectively.

Asia Wealth Management said the bourse concluded its day on recovery note where both indices were on the positive territory despite of 2.0% negative YTD.

“The market opened in a dull sentiment which later transformed to a positive aspect. Brown And Company emerged as the top traded counter, contributing circa 38.0% of the day’s turnover on the back of strategic institutional participation,” it added.

The counter saw a cumulative circa 2.5 mn shares changing hands at LKR290.00, which was a 4% of company’s total issued quantity. Renewed strategic interest was seen on Amana Takaful with a 150 mn block crossing at LKR2.00.

Meanwhile dominant retail interest was witnessed on Swarnamahal Financial Services, Softlogic Holdings and Vallibel One.