Bourse ends another lacklustre week
Both indices continued on the downward trend seen through most of
June with the ASPI losing 47.85 points to close at 6844.71 and the MPI
losing 94.87 to close at 6344.43.
ASPI contracted by 0.69 percent and the MPI by 1.47 percent. The
weekly turnover value recorded an increase of 17.7 percent to Rs 10.45
billion amounting to a daily average value of Rs 2.09 billion when
compared with last week's daily average turnover of Rs 1.77 billion. The
number of shares traded declined by 36.4 percent, averaging 77.5 million
shares traded daily as against 121.9 million traded last week.
The stock exchange
Last week too, the Banking and Finance sector led the turnover in
value as activity in finance counters was witnessed with the sector
accounting for 23.5 percent of turnover in value amounting to Rs 2.45
billion, led by investor interest in Central Finance recording a
turnover value of Rs 873.16 million representing 8.4 percent of the
The manufacturing sector was the second highest contributor to
turnover, accounting for 12.71 percent amounting to 1.33 billion. Third
highest on the turnover value list was the Investment Trust sector with
11.76 percent or Rs 1.23 billion. Volume of turnover for the week was
dominated by Banking and Finance sector with 122.3 million shares being
traded or 31.58 percent of volume of turnover, followed by the
Manufacturing sector which represented 19.66 percent of turnover volume
as 76.2 million shares traded.
Third highest contributor to turnover volume was the Power and Energy
sector, which accounted for 11.16 percent or 43.2 million shares.
Market Capitalization was at Rs 2,358.87 billion. Four counters
generated 28.3 percent of the week's total turnover value namely;
Central Finance, Aitken Spence, Distilleries and Environmental
Resources. Abans Financial and AMF Co Ltd which commenced trading this
week through introductions, were the major price gainers; Abans
financial closed the week at 66.50 (from 9.50) and AMF Co Ltd closed at
200.00 (from 135.00).
Lanka Ashok was also a major price gainer, recording a 44.3 percent
increase against last week's price of Rs 4,100. Swarnamahal Finance and
Finlays Colombo recorded gains of 39 percent and 33 percent
respectively. Union Assurance declined significantly over the week,
decreasing 49.8 percent to close at Rs.108.7.
AHOT Properties was another loser, dipping 49.5 percent against last
week's closing price of Rs 178.1 to close at Rs 89.90. Paragon declined
41.82 percent over the week to Rs 1,600. Harischandra and JKH fell 36.6
percent and 27.5 percent respectively.
Foreigners remained net sellers closing the week with a net sales
position of Rs 1.01 billion. Foreign purchases totaled to Rs 349.4
million recording a 44.3 percent decline from last week's total of Rs
501.7 million. Foreign selling for the week amounted to Rs 1.36 billion
an increase of 34.5 percent compared to last week.
SMB Leasing topped the volume list recording 37.1 million shares
changing hands representing 9.6 percent of the aggregate share volume.
Amana contributed 9.0 percent of aggregate share volume with 34.9
million shares changing hands.
Point of View
The Colombo bourse remained bearish during the week's trading with
both indices continuing to lose ground, amidst persisting selling
pressure to meet regulatory clearing and investments in primary market.
The year to date market return amounts to 3.15 percent, while the MPI
records a year to date loss of 10.2 percent. The market recorded a gain
of 35.7 percent during the same period in 2010. The market PER stands at
22.9x while the PBV is 2.9x.
Current market levels should spur buying interest ahead of the June
earnings season, in selected stocks within key sectors such as Banking,
Manufacturing, F&B which seem attractive on valuations at current
prices. Liquidity is expected to improve mid July aided by the IPO
refunds flowing back into the bourse.