Colombo stock market rebounds

The Colombo stock market managed to make a comeback yesterday with improved activity and a pick-up in investor sentiment.

The active S&P SL20 gained by 0.8% and the benchmark ASPI by 0.4%. This was a welcome change after the market on Tuesday suffered a loss ending a five-day winning streak.

Turnover improved to nearly Rs. 2 billion from Rs. 1.48 billion on Tuesday. Volume of shares traded too gained to 91.7 million shares from 70.5 million shares the previous day.

Asia Securities said indices recovered from an early decline to end positive yesterday as investors returned to heavyweight stocks following yesterday’s profit-taking session. Turnover was supported by off-board transactions in AGST (Rs. 540 million). Crossings accounted for 31.8% of turnover with 13 crossings in AGST (Rs. 540) and 1 crossing in MELS (Rs. 89.3 million).



Front-line stocks LIOC (+5.6%), MELS (+4.9%), LOLC (+5.1%), VONE (+4.1%), and RCL (+2.3%) closed higher while EXPO (-2.3%), SAMP (-0.7%), and NTB (-2.2%) ended with losses. Earlier, the ASPI declined to an intra-day low of 8,839 (-63 points) in the first hour of trading. Following this, the ASPI reversed course and moved upwards in the second half of the session to close with a gain of 36 points at 8,938. VONE (+15 points), LOLC (+14 points), LIOC (+13 points), and MELS (+10 points) were the major index movers during the session while EXPO (-10 points) ended as the biggest laggard on the ASPI. Overall, 70 stocks ended with price gains while 94 closed lower for the day.

Asia also said foreigners recorded a net outflow of Rs. 71.1 million. Net foreign buying topped in LIOC at Rs. 35.7 million and selling topped in MELS at Rs. 102 million.

First Capital said the bourse reverted to green after profit taking during Tuesday’s session following the outcome of the CBSL policy review meeting.

The Index dipped shortly into the market opening with investors reacting to policy rates being maintained at their current levels while profit taking continued on treasury counters. Subsequently, investors bought into LIOC shares following the healthy results of the company which reversed the ASPI momentum.

First Capital said CBSL signalled inflation would decline further in the coming months further strengthening investor sentiment. Eventually, the index recouped losses made during the day and closed in green at 8,938 gaining 36 points led by the contribution from LOLC and LIOC.

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

The Materials sector was the top contributor to the market turnover (due to Agstar) whilst the sector index gained 0.18%. The share price of Agstar increased by 50 cents (3.23%) to close at Rs. 16.

The Diversified Financials sector was the second highest contributor to the market turnover (due to LOLC Holdings) whilst the sector index increased by 2.16%. The share price of LOLC Holdings appreciated by Rs. 21.75 (5.11%) to close at Rs. 447.25.

Lanka IOC, Melstacorp and Expolanka Holdings were also included amongst the top turnover contributors. The share price of Lanka IOC gained Rs. 10.75 (5.62%) to close at Rs. 202. The share price of Melstacorp moved up by Rs. 2.40 (4.95%) to close at Rs. 50.90. The share price of Expolanka Holdings recorded a loss of Rs. 4.50 (2.30%) to close at Rs. 191.25.