Colombo bourse started the weekly operations on a negative note after recording six consecutive days of gains. Benchmark All share price index dipped by 10.59 points or 0.14% to end at 7,396.01 while S&P SL 20 index declined by 9.67 points or 0.23% to end at 4,150.64. Price depreciation in counters such as John Keells Holdings (closed at LKR 253.50, -2.4%), Hayleys (closed at LKR 340.00, -5.2%) & Carson Cumberbatch (closed at LKR 445.20, -1.1%) contributed adversely to the index performance.

Negative price movements in sectors such as information technology, diversified holdings and health care affected the market performance.

Market turnover was at LKR 1.7bn. Several crossings were recorded in Ceylon Tobacco (0.1mn shares at LKR 1,150.00-1,166.50 per share), Dialog Axiata (10.3mn shares at LKR 12.50 per share), Nestle Lanka (0.05mn shares at LKR 2,080.00 per share), John Keells Holdings (0.2mn shares at LKR 256.50-258.00 per share), Chevron Lubricants (0.1mn shares at LKR 339.00 per share) and Hatton National Bank (0.2mn shares at LKR 200.00 per share). Total crossings accounted to 28% of the total market turnover.

Accordingly John Keells Holdings emerged as the top contributor to the market turnover with LKR 348mn followed by Dialog Axiata (LKR 176mn) and Ceylon Tobacco (LKR 138mn).

Losers surpassed the gainers 121 to 98 while 49 counters remained unchanged. Cash map declined to 42% from 59%. 31 counters reached 52wk high prices while Lucky Lanka Milk Processing non-voting and Blue Diamond non-voting touched 52wk low price levels.

Meanwhile shares of Sanasa Development Bank attracted heavy investor attention today subsequent to the announcement of a rights issue. The company will issue 12.6mn shares through the rights issue at LKR 80.00 per share at a proportion of 1:2. The purpose of the issue is to increase the bank’s capital base in accordance with the Central Bank of Sri Lanka guidelines. The counter closed at LKR 100.60 (-13.2%).

Further Dankotuwa Porcelain, Union Bank and PCH Holdings were among heavily traded counters.

Foreign investors were net sellers with net outflow of LKR 13mn. While foreign participation was 44%. Net foreign outflows were seen in John Keells Holdings (LKR 209mn), Union Bank (LKR 14mn), Lanka Century Inv. (LKR 9mn) whereas net foreign inflow was mainly seen in Dialog Axiata (LKR 140mn).

According to the external sector performance in August 2014, further improvement was reported in export earnings (+ 7.9%YoY) while expenditure on imports increased by 16.9%. Trade deficit during the first eight months declined by 7.1% compared to the corresponding period in 2013. The balance of payment is estimated to have recorded a surplus of USD 2.2bn in the first eight months of 2014 compared to the deficit of USD 66mn reported in 2013.

Lanka Securities Research