Foreign investors’ craving persists; net inflow tops Rs. 15 b mark

Friday, 7 June 2013 05:44 - - {{hitsCtrl.values.hits}}

The craving for select Sri Lankan equities by discerning foreign investors persisted as the net inflow surpassed the Rs. 15 billion market yesterday, though profit taking by locals especially retailers with the Bourse up 15% last week remained a dampener.

Heavy buying into Commercial Bank and HNB resulted in a net foreign inflow of Rs. 552 million yesterday, propelling the year-to-date figure to Rs. 15.2 billion. This healthy development is on top of a record Rs. 39 billion worth of net inflow last year. With the current inflows and that of last year, the Colombo Bourse has overtaken the net outflow experienced in 2010 and 2011 combined.

NDB Stockbrokers said the Banking, Finance and Insurance sector became the top contributor to the turnover (due to Hatton National Bank and Commercial Bank) and the sector index dipped 0.39%. The share price of Hatton National Bank increased by Rs. 1.20 (0.71%) to close at Rs. 170 with the counter’s foreign holding increasing by 2,063,399 shares. The share price of Commercial Bank decreased by 0.32% to close at 122.90 with the counter’s foreign holding increasing by 2,000,000 shares. “Despite starting on a positive note, market lost steam predominantly due to the fall in prices witnessed in index heavy counters John Keells Holdings and Ceylon Tobacco Company,” NDBS said.

The ASI was down 50 points or 0.7% bringing the year-to-date gain lower to 13% from 15% on Friday and S&P SL 20 Index dipped by 39 points or 1%.

“The correction phase has set in with indices extending a steep downtrend,” Softlogic Stockbrokers said, adding that indices encountered a sharp dip as the Bourse moved on a volatile note.

It said John Keells Holdings, Ceylon Tobacco Company and Kotmale Holdings also recorded one crossing each. The latter saw strong on-board participation whilst having touched a 52-week high at Rs. 58. (+25.0%).

“Key dividend players which saw considerable rallies recently encountered steep price dips today as Chevron Lubricants and Ceylon Tobacco weighed strongly negative on the ASPI dipping to Rs. 310 (-12.8%) and Rs. 960 (-4.0%) at their respective intra-day low prices. John Keells Holdings recorded a notable dip of 4.0% at its intra-day low of Rs. 268. Investor play was observed in Nations Trust Bank which dipped 0.3% to Rs. 66.5, leaving further opportunity to accumulate,” Softlogic said.

Retailers remained cautious of the correction in the index, thereby focusing on a few selected counters. Nation Lanka Finance, Laugfs Gas and Tokyo Cement [Non-Voting] gathered significant interest.