Stock market suffers sharp decline; foreign buying intact

The Colombo stock market declined more sharply yesterday worsening its recent negative run with an apparent concern over 2023 Budget and future prospects.

The active S&P SL20 fell by 3% and the benchmark ASPI by 2.5% - sharpest in a week.

Turnover was Rs. 1.6 billion involving 69.5 million shares.

Asia Securities said the market closed in the red on the back of losses in heavyweight counters. Following a sharp decline in the first hour of trading, the ASPI stabilised to an extent in the range of 8,135-8,069. LOLC (-22 points) and EXPO (-20 points) led the decline in the index, followed by BIL (-12 points) and VONE (-11 points).

Following a pickup in the previous session, turnover remained at moderate levels above the LKR 1.0bn mark. EXPO and LIOC accounted for 40% of turnover, while crossings in CFIN also contributed to volumes. Market breadth was negative with 43 counters gaining and 163 counters closing lower.

Asia also said foreigners recorded a net inflow of Rs. 137.4 million. Net foreign buying topped in CFIN at Rs. 51.2 million whilst selling was most in RIL at Rs. 0.3 million.

First Capital said the Bourse recorded loss for the 3rd consecutive day while recording the highest intraday loss of 204 points in one week. Index plunged deeply as LOLC group reported a degrowth in earnings for the quarter (mainly LOLC and BIL) which majorly dragged down the investor sentiment and led the market close at 8,087, losing 204 points. 

However, in response to the CBSL Governor’s decision to ease liquidity shortage in banks and a possible downward revision of interest rates boosted confidence in FCT, CFVF and CALT. Despite a loss, turnover improved largely led by Transportation and Diversified Financials sectors accounted for a joint contribution of 50%. Meanwhile, CFIN recorded an off-board transaction of 2.2 million shares (1% stake) for  Rs. 141 million.

NDB Securities said high net worth and institutional investor participation was noted in John Keells Holdings and Central Finance Company. Mixed interest was observed in Expolanka Holdings, Lanka IOC and LOLC Holdings whilst retail interest was noted in Browns Investments, LOLC Finance and SMB Leasing.

Transportation sector was the top contributor to the market turnover (due to Expolanka Holdings) whilst the sector index lost 6.66%. The share price of Expolanka Holdings decreased by Rs. 9.50 (6.68%) to close at Rs. 132.75.

Diversified Financials sector was the second highest contributor to the market turnover (due to Central Finance Company and LOLC Holdings) whilst the sector index decreased by 4.74%. The share price of Central Finance Company moved up by Rs. 2.10 (3.44%) to close at Rs. 63.10. The share price of LOLC Holdings declined by Rs. 34.25 (8.98%) to close at Rs. 347.25.

Lanka IOC and Browns Investments were also included among the top turnover contributors. The share price of Lanka IOC lost Rs. 6.25 (3.57%) to close at Rs. 168.75. The share price of Browns Investments recorded a loss of 50 cents (8.93%) to close at Rs. 5.10.