CSE sees sharp rebound as investors turn bullish

The Colombo stock market yesterday produced a strong rebound thanks to investors turning bullish with high turnover.

The active S&P SL20 gained by 2.2% and the benchmark ASPI by 1.4%. The gain ended the bearish trend seen since late last week. 

Foreigners were also net buyers yesterday.

Turnover rose to Rs. 4.36 billion involving 137 million shares.

Asia Securities said following three sessions of downward momentum, the indices recovered on a strong note supported by banking counters and front-line heavyweights. 

JKH (+4.2%), COMBN (+4.0%), COMBX (+3.0%), NTBN (+1.7%), SEYBN (+6.3%), DFCC (+5.3%), and DIAL (+3.5%) led the ASPI’s recovery while CALT (+8.3%), CFVF (+6.0%), CFIN (+9.6%), PLC (+4.2%), GLAS (+3.3%), and MGT (+4.7%) saw steady domestic buying during the session.

The breadth of the market was positive with 116 price gainers and 86 decliners.

Turnover picked up led by foreign buying in JKH and MELS.

Foreigners recorded a net inflow of Rs. 351 million while their participation increased to 18.1% of turnover (previous day 4.9%). Net foreign buying topped in JKH at Rs. 314.4 million while selling topped in SAMP.N at Rs. 73.7 million.

First Capital said the Bourse closed the day on a positive note gaining 162 points after losing 3.7% during the last consecutive 3 sessions, as a result of improved investor participation on Banking Sector shares and Blue Chip companies.

Treasury share counters witnessed revitalized interest due to excellent performance displayed during the 1QFY24. The drop of T-Bill rates at the auction also backed the improved investor sentiment on Treasury Counters.

Diversified Financial sector had interest during today’s session as it positively backed both the index and the turnover, resulting from the recent lifting of import restrictions regarding heavy vehicles such as buses, trucks and tankers. The turnover was 24.5% higher than the monthly average of Rs. 3.5 billion aided by the Banking Sector (23%), Diversified Financials Sector (20%) and Capital Goods Sector (17%) respectively.

NDB Securities said high net worth and institutional investor participation was noted in John Keells Holdings, Melstacorp, and Expolanka Holdings. Mixed interest was observed in Capital Alliance, Teejay Lanka and Commercial Bank whilst retail interest was noted in Softlogic Capital, SMB Leasing nonvoting and Browns Investments.

The Banking sector was the top contributor to the market turnover (due to Hatton National Bank) whilst the sector index gained 2.31%. The share price of Hatton National Bank appreciated by one rupee to Rs. 183.25.

The Diversified Financials sector was the second highest contributor to the market turnover (due to Capital Alliance) whilst the sector index increased by 3.78%. The share price of Capital Alliance recorded a gain of Rs. 5 to Rs. 65.40.

John Keells Holdings, Teejay Lanka and Melstacorp were also included amongst the top turnover contributors. The share price of John Keells Holdings increased by Rs. 7.75 to Rs. 191.50. The share price of Teejay Lanka gained 50 cents to Rs. 33.50. The share price of Melstacorp dipped 90 cents to Rs. 82.