Stock Market Review – 20th Mar 2015

March, 20, 2015

Colombo bourse finished the week on a mixed note in another trading session marked by thin trade as investors opted to stay on sidelines amid the developments in the political and economic fronts. The main index remained in the negative territory for most of the trading session but managed to close 7.88 points (+0.1%) higher at 7,054.58. The S&P SL 20 index closed at 4,016.90 with a drop of 2.58 points or 0.1%.

Price inclines in index-heavyweights Ceylon Tobacco (LKR 1,030.00,+3.0%), Commercial Leasing & Finance (LKR 4.30, +4.9%), Nestle Lanka (LKR 2,320.00,+0.9%) and Lions Brewery (LKR 625.00,+1.6%) supported the main index to close higher.

Market breadth was negative with losers outpacing gainers by 92 to 64, while 64 counters remained unchanged. Cash map declined from 55% to 51%. 17 counters touched 52 week low price levels while only two counters managed to reach 52 week high prices.

The turnover remained weak at LKR 370mn, less than one third of the daily average turnover reported so far this year. The top contribution to the turnover came from Access Engineering (LKR 53mn), Seylan Bank- non-voting (LKR 34mn) and Peoples Leasing Co (24mn). Interestingly, no crossings were recorded today.

Investors reacted to the government’s decision to withdraw the USD 85mn airport runaway contract awarded to Access Engineering and the selling pressure dragged the share to a 52 week low of LKR 21.00 during the session. However the share managed to close slightly higher at LKR 21.80 (-9.2%).

The interest on Seylan Bank shares continued in today’s trading session and both voting and non-voting shares touched 52 week high price levels. Seylan Bank voting share closed at LKR 101.00 (+0.8%) while non-voting share closed at LKR 65.70.

Apart from shares of Access Engineering and Seylan Bank, investor interest was seen in counters such as Sanasa Development Bank, Textured Jersey, John Keells Holdings and Commercial Credit & Finance.

Meanwhile, the first interim dividend of LKR 2.50 declared by Ceylon Investment did not receive attention from the investors and the share closed at LKR 95.00, +0.1% while Asian Hotels & Properties managed to close at LKR 64.00, +0.3% on the XD date of its interim dividend.

The foreign investors extended their buying streak for the fourteenth session in a row and the foreign participation reached 20% of the market activity. Including todays’ inflow of LKR 63mn, the net foreign inflow during last three weeks, i.e. in the month of March, amounts to LKR 1.8bn. Today’s net foreign inflow was mainly seen in Lanka Tiles (LKR 14mn), John Keells Holdings (LKR 14mn) and Tokyo non-voting (LKR 7mn) while net outflow was mainly seen in LB Finance (LKR 2mn).

The core index lost 36.67 points or 0.52% during the week while S&P SL 20 index shed 31.07 points or 0.77% reflecting the lackluster investor activities throughout the week. Seylan Bank emerged as the top contributor to the weekly turnover with LKR 1.6bn followed by John Keells Holdings (LKR 716mn) and Seylan Bank non-voting (LKR 287mn).

Samson International, Hotel Sigiriya and Serendib Hotels were among top gainers for the week while Ramboda Falls, Access Engineering and Multi Finance were top losers of the week. RSI marginally declined during the week to 31 from 32 from the previous week.

Foreign investors were net buyers for the week with net inflow of LKR 751mn. Foreign participation was 21%. Net foreign inflows were seen in John Keells Holdings (LKR 549mn), Lanka Tiles (LKR 65mn) and Sampath Bank (LKR 40mn) while net foreign outflow were mainly seen in Hatton National Bank (LKR 84mn), and Laugfs Gas (LKR 34mn).

Meanwhile at the Treasury bill auction, T-Bill yields dropped notably where 12M yield declined by 38bps to 6.99% while 3M yield declined by 31bps to 6.79% and 6M yield declined by 44bps to 6.87%.

Lanka Securities Research

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