Stock market shows resilience despite fresh COVID-19 scare

• ASPI up 3.1%, largest day gain since 
• 18 May with healthy turnover of Rs. 2.9 b
• Year-to-date net foreign outflow nears Rs. 43 b

The Colombo stock market showed signs of resilience yet again, with the benchmark index recording a sharp gain amidst healthy turnover yesterday.

The All Share Price Index (ASPI) gained by 3.1%, the highest day gain since 18 May, to 5,724 points. The S&P SL 20 Index was up 2% to 2,317 points. 

Turnover was Rs. 2.9 billion, though down by 25% from Wednesday. Most brokers said high networth individual investors and retailers were dominant, hence the market showed resilience. 

The only negative factor was continuing foreign exits though locals were snapping up opportunities. 

With net foreign selling of near Rs. 2 billion in the past two days, the year-to-date net foreign outflow was at Rs. 42.53 billion.

First Capital said the market rally regained momentum, sustaining the drive in the green zone for the second consecutive session.  

“The index experienced a strong uptrend during the early hours of trading predominantly due to the buying interest in EXPO and thereafter recorded a sideways movement during mid-day. Within the final 30 minutes of trading, the index moved upwards and closed at 5,725 gaining a massive 171 points,” First Capital added. 

It said Capital Goods counters continued to dominate the turnover for the day contributing 39% led by JKH. Moreover, the parcel trades boosted the turnover amounting to 27% of the total. 

Foreign investors continued to be net sellers while recording low participation.

Asia Securities said the market saw strong gains as investors were back collecting on cheap valuations ahead of the earnings season. 

“Some foreign selling came through in the day, however was seen absorbed by the HNIs,” Asia added. It said apart from Capital Goods sector, the Transportation sector and Materials sector generated Rs. 541.4 million and Rs. 372.1 million respectively. 

NDB Securities said the ASPI closed in green as a result of price gains in counters such as Commercial Leasing & Finance, Carson Cumberbatch and Ceylon Cold Stores.

It said high net worth and institutional investor participation was noted in John Keells Holdings and Expolanka Holdings. Mixed interest was observed in Tokyo Cement Company non-voting and voting, whilst retail interest was noted in Hayleys Fabric, Sampath Bank and Raigam Wayamba Salterns. Furthermore, foreigners remained active closing as net sellers mainly due to foreign selling in John Keells Holdings.

The Capital Goods sector was the top contributor to the market turnover (due to John Keells Holdings), whilst the sector index gained 2.75%. The share price of John Keells Holdings increased by Rs. 1 (0.77%) closing at Rs. 131, whilst foreign holdings decreased by 5,888,906 shares.

The Transportation sector was the second highest contributor to the market turnover (due to Expolanka Holdings), whilst the sector index increased by 9.86%. The share price of Expolanka Holdings gained Rs. 1.20 (9.92%) to close at Rs. 13.30.

Tokyo Cement Company non-voting and voting and Hayleys Fabric were also included amongst the top turnover contributors. The share price of Tokyo Cement Company non-voting moved up by Rs. 2.70 (6.54%) to close at Rs. 44. Furthermore, the share price of Tokyo Cement Company recorded a gain of Rs. 2.80 (5.49%) to close at Rs. 53.80, whilst the share price of Hayleys Fabric appreciated by Rs. 1.20 (5.29%) to close at Rs. 23.90.