Stock market posts creditable recovery after early losses

• Locals’ optimism propels market capitalisation to over Rs. 6 t
• Persistent negativity sees net foreign selling cross Rs. 2 b mark within weeks of New Year

The Colombo stock market yesterday produced a creditable recovery to finish on a positive note after early losses amidst relatively low turnover.

Whilst locals remained optimistic with market capitalisation surpassing the Rs. 6 trillion milestone, foreigners continue to be negative with net selling topping Rs. 2 billion mark, already within weeks of the New Year.

Asia Securities said after witnessing an initial decline due to price losses in EXPO, SHL and LOLC, the ASPI showcased a strong rebound in the second half of the session supported by price gains in CLC, SLTL, MELS and LLUB and managed to close in green territory for the fourth consecutive session.

It said healthy retail and HNI buying was witnessed throughout the session with turnover at Rs. 5.56 billion (previous session – Rs. 7.1 billion).

VONE generated the highest turnover for the day at Rs. 397 million, followed by ACL (Rs. 389 million), BIL (Rs. 269 million) and TJL (Rs. 253 million). PARQ (+9.9%), LLUB (+6.6%), ACL (+6.1%) and TJL (+6.0) saw a notable pickup in retail and HNI buying appetite during the session and ended with sizable gains.  

“Earlier, the ASPI commenced trading surpassing the 13,500 mark with a gap up of 73 points and gradually declined to an intra-day low of 13,343 (-114 points) in mid-afternoon trade. Regaining ground thereupon, the ASPI recovered as much as 119 points in the second half of the session and ended the session on a positive note recouping all of its intra-day losses. Overall, 111 stocks closed higher while 118 settled with losses,” Asia added.

It said foreigners recorded a net outflow of Rs. 117.4 million while their participation increased to 2.8% of turnover (previous day 2.7%). Net foreign buying topped in EXPO at Rs. 23 million and selling topped in TJL at Rs. 63.3million.

First Capital said the bourse closed strongly in the green territory, following the continuous upward momentum for the fourth consecutive day despite recording a three-and-a-half-week low turnover. “During the initial 30 minutes, index spiked by nearly 70 points following a back-to-back bull rally. However, the market took a reversal note and dropped down significantly during the mid-day while reaching an intraday low of 13,339. As investors began to infuse buying sprees following a sharp fall, the market moved up and managed to stay in the green zone and closed for the day at 13,462, gaining five points,” First Capital added.

It said turnover was led by the Capital Goods sector accounting for a contribution of 28%.

NDB Securities said high net worth and institutional investor participation was noted in Lanka Orix Finance, Commercial Bank and Cargills. Mixed interest was observed in Vallibel One, ACL Cables and Teejay Lanka, whilst retail interest was noted in SMB Leasing non-voting, Browns Investments and Softlogic Capital.

The Capital Goods sector was the top contributor to the market turnover (due to Vallibel One and ACL Cables) whilst the sector index gained 0.04%. The share price of Vallibel One increased by 70 cents (0.72%) to close at Rs. 98.10. The share price of ACL Cables gained by Rs. 6.75 (6.14%) to close at Rs. 116.75.

The Diversified Financials sector was the second highest contributor to the market turnover (due to Lanka Orix Finance), whilst the sector index increased by 0.28%. The share price of Lanka Orix Finance appreciated by 30 cents (1.06%) to close at Rs. 28.70.

Browns Investments and Teejay Lanka were also included amongst the top turnover contributors. The share price of Browns Investments moved down by ten cents (0.59%) to close at Rs. 16.80. The share price of Teejay Lanka recorded a gain of Rs. 3.20 (6.02%) to close at Rs. 56.40.