The price indices in the Colombo Bourse dipped yesterday after whopping gains in previous sessions despite high turnover as investor sentiments were dampened by calls for lockdown as well as revision in policy rates by the Central Bank.

The All Share Price Index was down by over 82 points or 1% and the S&PSL20 declined by over 26 points or 0.8%. Turnover amounted to Rs. 5.5 billion (lower by 14% from Wednesday) involving 311 million shares.   

On the positive side, foreign investors recorded a net inflow of Rs. 25 million as against a net outflow of Rs. 26.6 million the previous day.

First Capital said the Bourse ended trading in the red territory as the market heated up, causing ballooning selling pressure due to the monetary policy rate hike by CBSL and profit taking amidst the five-month index high. 

“Index opened on an upbeat note, however, displayed significant volatility throughout the session, before closing at 8,260, while losing 83 points,” First Capital added. 

It said turnover was led by the Transportation sector, followed by the Diversified Financials sector, accounting for a joint contribution of 57%. 

Asia Securities said the Central Bank’s policy rates revision along with profit-booking in counters which posted sharp gains this week dragged the indices down yesterday. 

“The indices witnessed a volatile early session in which the ASPI, after nearly reaching the 8,400 level, dropped 133 points, and subsequently gained 98 points during the mid-afternoon trading. Nevertheless, the index again trended downwards in the second half of the session as a result of profit-taking in index-heavy counters and eventually closed lower, after gaining 406 points in the last two sessions,” Asia said. 

It said turnover remained at stronger levels, supported by activity in EXPO. 

“However, concerns over slight increases in the policy rates and late media reports speculating a complete lockdown weighed on investors’ momentum seen during the last two sessions. Despite the increase in policy rates, we believe equities will remain the preferred asset class as rates are recovering from a low, and equity returns will continue to outstrip fixed income gains,” Asia Securities said.

NDB Securities said the ASPI closed in red as a result of price losses in counters such as LOLC Development Finance, LOLC Holdings and Expolanka Holdings.

It said high net worth and institutional investor participation remained subdued for the day. 

Mixed interest was observed in Expolanka Holdings, LOLC Holdings and Commercial Leasing & Finance, whilst retail interest was noted in Browns Investments, Lanka Orix Finance and Sierra Cables. Foreign participation in the market activity remained at subdued levels with foreigners closing as net buyers.

The Transportation sector was the top contributor to the market turnover (due to Expolanka Holdings), whilst the sector index lost 3.33%. The share price of Expolanka Holdings decreased by Rs. 3.30 (3.34%) to close at Rs. 95.50.

The Diversified Financials sector was the second highest contributor to the market turnover (due to Lanka Orix Finance and LOLC Holdings), whilst the sector index decreased by 1.19%. The share price of Lanka Orix Finance moved up by Rs. 0.90 (9%) to close at Rs. 10.90. The share price of LOLC Holdings declined by Rs. 16.25 (3.41%) to close at Rs. 459.75.

Browns Investments and Sierra Cables were also included amongst the top turnover contributors. The share price of Browns Investments closed flat at Rs. 7. The share price of Sierra Cables recorded a gain of Rs. 1.10 (13.41%) to close at Rs. 9.30.

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