Colombo equities snapped the five day losing streak and closed with positive returns as bargain hunters entered into the battered blue-chips driving the market activity to a 3 week high. All share index gained 14.01 index points (0.20%) to close at 7,118.38 while 20-scrip S&P SL index end higher at 3,895.70, up by 14.66 index points or 0.38%.

Premier blue chip, John Keells Holdings (closed at LKR 176.00, +1.7%) drove the index performance to greener territory along with price inclines in Lanka Orix Leasing Company (closed at LKR 104.00, +7.4%), Hemas Holdings (closed at LKR 87.90, +2.2%) and Overseas Realty (closed at LKR 23.90, +3.5%).

Daily market turnover reached to LKR 806mn recording a 3 week high supported by two crossings which accounted for 19% of the total turnover. John Keells Holdings topped the turnover list with LKR 156mn underpinned by a single crossing of 0.2mn shares at LKR 175.00.

Further, 0.8mn shares of Three Acre Farms changed hands in a single crossing at LKR 142.10 and was the next best contributor to the turnover with LKR 145mn. Ceylon Grain Elevators (LKR 76mn) and Bairaha Farms (LKR 52mn) were among highest contributors to the turnover. Accordingly, 34% of the total turnover was contributed by the poultry sector counters.

Poultry segment continued the rally where all three counters namely Ceylon Grain Elevators (LKR 96.70), Bairaha Farms (LKR 204.50) and Three Acre Farms (LKR 148.90) marked fresh 52wk high prices. Ceylon Grain Elevators closed at LKR 95.00 (+2.9%) while Bairaha Farms & Three Acre Farms closed at LKR 204.20 (+5.5%) & LKR 146.90 (+3.4%) respectively.

Market breadth was positive where out of 259 counters, 112 advanced, 78 slipped while 69 counters remained unchanged. Cash map slightly dipped from 60% to 59%. 20 stocks touched 52wk low prices while 08 stocks managed to reach 52wk high price levels.

Consequent to the price advancement in John Keells Holdings voting share, both warrants closed with sizable gains during the session. Warrant 0022 increased to LKR 11.50 but closed lower at LKR 11.30 (+32.94%) while warrant 0023 closed at LKR 40.00 (+5.5%).

Meanwhile, Sierra Cables announced that the board of directors have approved the project to start a cable manufacturing plant in Kenya to supply transmission and distributional cables to East African countries in upcoming months. Stock witnessed marginal returns where it closed at LKR 4.40 (+2.3%).

Foreign investors were net buyers after two consecutive days of outflows with a net inflow of LKR 31mn. Foreign participation was 32%. Net foreign inflows were seen in John Keells Holdings (LKR 34mn), Central Finance (LKR 25mn), Nawaloka Hospitals (LKR 3mn) while net foreign outflow was mainly seen in Chevron Lubricants (LKR 3mn).

At today’s treasury bill auction, yields of 3M & 12M treasury bills inclined by 1bps each to 6.78% and 7.18% respectively while 6M treasury yield remained unchanged at 7.07%. CBSL offered LKR 22bn worth of Treasury bills and the auction was oversubscribed by 2.8 times with bids received amounting to LKR 61.2bn. It was decided to accept LKR 28.3bn worth of bills.

Lanka Securities Research