Second week of losses at Colombo stock market

The Colombo stock market ended its second week of losses yesterday as investor sentiment remained mixed.

The benchmark ASPI lost 90.12 points (1.01%) and the active S&P SL20 declined 43.67 points (1.58%). The dip however was lower as against 2.62% and 3.74% respectively the previous week, which brought three weeks of gains to an end.

Turnover this week averaged Rs. 1.7 billion up from Rs. 1.6 billion in the previous week.  The market also saw a cumulative net inflow of Rs. 586 million on continuous buying in JKH and SPEN. The previous two weeks saw net inflows of Rs. 1.9 billion and Rs. 1.5 billion. 

Asia Securities said the market witnessed lacklustre momentum in the final trading session of the week as investors moved to the sidelines awaiting directional cues following the latest tariff hike announcement while some profit-booking ahead of the weekend was seen in front-line stocks after Thursday’s sharp price increases. 

Sectorally, banking stocks saw improved domestic buying interest resulting in healthy gains in HNB (+5.5%), HNBX (+6.1%), COMB (+3.6%), COMBX (+1.4%), NTB (+2.3%), NDB (+2.9%) and ABL (+7.4%). On the other hand, JAT (+14.3%), TKYON (+3.0%), TKYOX (+3.0%), HHL (+2.3%), MGT (+4.1%), and HAYC (+2.5%) scaled price gains in an otherwise flat session.

Retail stocks SCAP (-2.3%), AAIC (-9.0%), EXPO (-1.4%), BIL (-3.3%), LOFC (-7.5%), and CALT (-2.1%) ended in red due to profit-booking at higher levels. 

COMB (+18 points), HNB (+14 points), and MELS (+7 points) were the major index movers during the session while VONE (-10 points) and LOFC (-8 points) ended as the top laggards on the ASPI. The breadth of the market was neutral with 86 price gainers and 88 decliners.

Turnover yesterday declined to Rs. 1.3 billion from Rs. 2 billion on Thursday led by SCAP (Rs. 235 million), VLL (Rs. 142 million), and MELS (Rs. 125 million). 

Foreigners recorded a net inflow of Rs. 29.7 million. Net foreign buying topped in MELS at Rs. 36.1 million and selling topped in JKH at Rs. 23 million.

First Capital said after the significant gain recorded during the previous session, ASPI closed the day flat displaying significant volatility as investors remained on the sidelines waiting for a clarity from the IMF meeting with the creditors on Friday. As a result, overall Banking sector counters positively contributed to the index as China expressed support for the country ahead of the creditors meeting. 

Accordingly, the index continued to upscale yet gradually sidelined and closed the day flat at 8,848, gaining five points. As the tourist arrivals continued to grow and recorded over 50,000 arrivals during the first two weeks of the month, the Hotels sector displayed a slight buying interest. 

As significant profit-taking loomed on SCAP and AAIC, turnover skid to Rs. 1.3 billion (-30% cf. monthly average turnover of Rs. 1.8 billion). Accordingly, the Insurance sector (28%) continued to dominate the market turnover coupled with Food, Beverage and Tobacco sector (16%). Moreover, VLL.N witnessed a stake change of 2.8% through an off-board transaction totalling to 24 million shares at Rs. 5.90 each.

NDB Securities said high net worth and institutional investor participation was noted in Vidullanka and Melstacorp. Mixed interest was observed in Softlogic Life Insurance, Hatton National Bank and Expolanka Holdings whilst retail interest was noted in Softlogic Capital, SMB Leasing nonvoting and Amana Bank. 

The Insurance sector was the top contributor to the market turnover (due to Softlogic Life Insurance) whilst the sector index lost 1.44%. The share price of Softlogic Life Insurance recorded a loss of Rs. 9.60 (8.97%) to Rs. 97.40.

The Food, Beverage and Tobacco sector was the second highest contributor to the market turnover (due to Melstacorp) whilst the sector index decreased by 0.28%. The share price of Melstacorp moved up by Rs. 1.60 (2.88%) to Rs. 57.10.

Softlogic Capital, Vidullanka and Hatton National Bank were also included among the top turnover contributors. The share price of Softlogic Capital decreased by Rs. 0.30 (2.31%) to Rs. 12.70. The share price of Vidullanka lost 10 cents to Rs. 5.90. The share price of Hatton National Bank appreciated by Rs. 5.50 to Rs. 105.50.