Bear run persists at Colombo stock market

The bear run persisted at the Colombo stock market yesterday as local investor sentiment remained fragile. 

The indices had a rocky day before closing lower by 0.1%. Turnover was Rs. 1.87 billion involving 82.2 million shares. Foreigners remained net buyers.



Asia Securities said after witnessing a subdued first half, the indices staged a sharp recovery in the final hour trading and closed marginally lower on Wednesday as investors resorted to bargain buying in front-line stocks following consecutive sessions of price losses. 

The ASPI initially touched a high of 8,676 (+37 points) however saw a subsequent decline to 8,581 (-58 points) in mid-day trading. Following this, the index hovered in the range of 8,590-8,610 before witnessing a late-recovery to 8,629 (-10 points). SCAP (-12.5%) and AAIC (-4.7%) remained in red territory, however recouped some of their early losses towards the end of the session. RCL (+1.9%), ACL (+1.0%), CICN (+1.1%), CICX (+2.5%), and HAYL (+1.6%) scaled higher while BIL (-3.4%), LOFC (-5.1%), and EXPO (-0.3%) closed in red. 

Turnover was led by EXPO (Rs. 466 million), SCAP (Rs. 333 million), and AAIC (Rs. 280 million). The breadth of the market remained negative with 76 price gainers and 91 decliners. 

Foreigners recorded a net inflow of Rs. 147.7 million. Net foreign buying topped in JKH at Rs. 90.8 million and selling topped in DIPD at Rs. 14 million.

Crossings accounted for 24.5% of turnover with 10 crossings recorded in EXPON (Rs. 337.5 million), two crossings in DIPD (Rs. 80.9 million), one crossing each in LIOC (Rs. 20.5 million) and AHPL (Rs. 20 million).

First Capital said the bourse closed flat as negative sentiment persists among investors over delays in securing the IMF Board-Level Agreement and the postponement of the local government election. The Index started to scale down as soon as the market opened as panic selling lingered on AAIC and SCAP. 

Meanwhile, positive sentiment emerged on fundamentally strong counters which led to a recovery in the market towards the end of the session. LOLC group companies mainly BIL and LOFC pulled down the index and led the market to close at 8,629, losing 10 points. 

Turnover dipped as investors chose to be on the sidelines waiting for a clear direction on the macroeconomic front. Off-board transactions contributed 24% to the turnover while Insurance and Transportation sectors (mainly EXPO) jointly accounted for 58%. Meanwhile, JKH and SPEN continued to attract foreign investments and lead the foreign inflow where YTD net foreign inflow recorded at Rs. 4.2 billion. 

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

The Insurance sector was the top contributor to the market turnover (due to Softlogic Life Insurance) whilst the sector index lost 0.61%. The share price of Softlogic Life Insurance moved down by Rs. 4.80 (4.66%) to Rs. 98.20.

The Transportation sector was the second highest contributor to the market turnover (due to Expolanka Holdings) whilst the sector index decreased by 0.29%. The share price of Expolanka Holdings decreased by 50 cents to Rs. 173.75. 

Softlogic Capital, Dipped Products and John Keells Holdings were also included amongst the top turnover contributor. The share price of Softlogic Capital lost Rs. 1.50 (12.50%) to Rs. 10.50. The share price of Dipped Products recorded a gain 10 cents to Rs. 27.10. The share price of John Keells Holdings closed flat at Rs. 140.