Block deals, retail trades push stock market up 1%

Reuters: Sri Lanka’s bourse rose one per cent on Friday on retail buying and two large block trades but foreign investors sold out in the largest volume in three months, amid global economic uncertainty, traders said. Sri Lanka’s main share index rose 1.24 per cent in early trade closed 0.97 per cent or 65.97 points firmer at 6,833.06, highest since 1 August.

Foreign investors sold a net Rs. 871.5 million ($ 7.9 million) worth of shares on Friday, highest since 20 May, extending the week’s outflow to 1.26 billion. They have sold 10.1 billion so far in 2011 and a record 26.4 billion in 2010.

“It was a retail-driven market with some high net worth (investor) participation as the global sentiments also turning positive,” a stockbroker said on condition of anonymity.

Block deals of Asian Alliance Insurgence and Colonial Motors pushed the day’s turnover to more than eight-month high of Rs. 5.74 billion, well above last year’s average of 2.4 billion and this year’s 2.66 billion. Asian Alliance Insurance, which accounted for 58 per cent of the day’s turnover and 22 per cent of volume, closed 11.2 per cent firmer at Rs. 134 while Colonial Motors closed up 4.2 per cent at 294 rupees and accounted for 6.3 per cent of turnover.

Friday’s total volume was 124.7 million, against a five-day average of 111.3 million. The 30-day and 90-day average trading volumes were 86.6 million and 110.7 million. Last year’s daily average was 67.9 million.     The index which regained its position of Asia’s best on Tuesday was at second place on Friday with a 2.97 per cent gain on the year.

The island nation’s bourse gave Asia’s best returns in 2009 and 2010, nearly tripling in value after the end of a civil war. But a regulator-imposed margin trading phase-out has hurt, giving its first negative on-the-year returns since 2008.

On Friday, world stocks edged up but were still poised to end another week in the red as investors continued to dump riskier assets, bringing losses so far this month to more than 10 per cent.

The rupee ended up at 109.63/65 a dollar from Thursday’s close of 109.65/70, on heavy dollar selling by a bank, dealers said.