Stock market loses steam with erratic investor sentiment

The Colombo stock market lost its recent steam yesterday, closing on a negative note as investor sentiment remained erratic.

The All Share Price Index declined by 83 points or 0.9% and the S&P SL20 shed 22 points or 0.6%. Turnover was Rs. 4 billion involving 215.5 million shares. Yesterday’s bearish status was after the market enjoyed two consecutive days of sharp rebound on Tuesday and Wednesday following a 4% plunge on Monday.

Asia Securities said following two sessions of gains, the indices closed in red due to price declines in large-cap stocks as investors opted to book modest returns after the recent sharp rally. 

“The ASPI witnessed a bout of volatility during early hours after Wednesday’s upbeat session and moved within a narrow range of 8,920-8,940 till mid-afternoon trade. However, the index extended its losses owing to a late-hour decline, which pulled the index below the 8,900 level,” Asia added.

It said the market breadth turned negative as around 124 stocks declined while 65 stocks settled with gains. 

Stocks such as EXPO, LOLC, and BIL, which saw sharp gains in the past two sessions, witnessed profit-taking at higher levels and weighed on the momentum throughout the session. 

Turnover remained at healthy levels on the back of retail and HNI activity in EXPO and BIL, which collectively accounted for 61% of total, Asia said.

First Capital said the bourse bounced back to the red zone as investors gave away to selling pressure while recording a scarce turnover.

“Index set off on an upswing in the first half hour and displayed a sideways drift thereon till mid-session. During the latter part of the session, the index began to plunge as investors engaged in profit booking and hit an intraday low of 8,831 before closing for the day at 8,848,” First Capital added.

It said turnover was led by a joint contribution of 62% from the Transportation and Food, Beverage and Tobacco sectors.

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

It said high net worth and institutional investor participation was noted in Sampath Bank. Mixed interest was observed in Expolanka Holdings, Tokyo Cement Company non-voting and LOLC Holdings, whilst retail interest was noted in Browns Investments, Lanka Orix Finance and Industrial Asphalts.

The Transportation sector was the top contributor to the market turnover (due to Expolanka Holdings), whilst the sector index lost 2.93%. The share price of Expolanka Holdings decreased by Rs. 5 (2.93%), closing at Rs. 165.50.

The Food, Beverage and Tobacco sector was the second highest contributor to the market turnover (due to Browns Investments), whilst the sector index decreased by 0.32%. The share price of Browns Investments lost 30 cents (3.03%), closing at Rs. 9.60.

Sampath Bank, Lanka Orix Finance and Tokyo Cement Company non-voting were also included amongst the top turnover contributors. The share price of Sampath Bank moved up by 30 cents (0.58%) to close at Rs. 51.90. The share price of Lanka Orix Finance recorded a loss of ten cents, closing at Rs. 8.50. The share price of Tokyo Cement Company non-voting appreciated by Rs. 3.90 (9.61%) to close at Rs. 44.50.