Trade Summary Market - 12/11/2012

COLOMBO | Mon Nov 12, 2012 4:48pm IST
Nov 12 (Reuters) - Sri Lankan stocks gained for the seventh straight session on Monday to end at a more than three-week high led by foreign buying and supported by optimism a new budget will bring measures to boost the capital market.

But concern over high interest rates limited trading volume, analysts said.

The Colombo Stock Exchange's main index rose 0.19 percent, or 10.45 points, to end at 5,599.88, its highest level since Oct. 19.

Foreigners bought a net 43.6 million rupees ($333,300) worth of shares, extending the net foreign inflow this year to 35 billion rupees.

Turnover, however, was 244 million rupees compared with the year's daily average of 909.4 million rupees.

"Volumes are down because the confidence has not returned," said a stockbroker who declined to be identified.

"Nobody wants to take a risk to invest in stocks when they can earn a risk-free rate of around 15 percent in fixed deposits."

President Mahinda Rajapaksa, who is also finance minister, announced in his budget speech proposals to encourage new listings of shares and debentures through tax exemptions.

Under the budget, presented on Thursday and to be voted on at the end of the week, the government also aims to reduce the fiscal deficit to 5.8 percent of gross domestic product in 2013, while reaching 7.5 percent economic growth next year.

The rupee closed firmer at 130.40/50 to the dollar compared with Friday's close of 130.75/85 in dull trade, dealers said. ($1 = 130.8000 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Robert Birsel)
http://in.reuters.com/article/2012/11/12/markets-srilanka-idINL3E8MC3SE20121112

COLOMBO | Mon Nov 12, 2012 4:48pm IST
Nov 12 (Reuters) - Sri Lankan stocks gained for the seventh straight session on Monday to end at a more than three-week high led by foreign buying and supported by optimism a new budget will bring measures to boost the capital market.

But concern over high interest rates limited trading volume, analysts said.

The Colombo Stock Exchange's main index rose 0.19 percent, or 10.45 points, to end at 5,599.88, its highest level since Oct. 19.

Foreigners bought a net 43.6 million rupees ($333,300) worth of shares, extending the net foreign inflow this year to 35 billion rupees.

Turnover, however, was 244 million rupees compared with the year's daily average of 909.4 million rupees.

"Volumes are down because the confidence has not returned," said a stockbroker who declined to be identified.

"Nobody wants to take a risk to invest in stocks when they can earn a risk-free rate of around 15 percent in fixed deposits."

President Mahinda Rajapaksa, who is also finance minister, announced in his budget speech proposals to encourage new listings of shares and debentures through tax exemptions.

Under the budget, presented on Thursday and to be voted on at the end of the week, the government also aims to reduce the fiscal deficit to 5.8 percent of gross domestic product in 2013, while reaching 7.5 percent economic growth next year.

The rupee closed firmer at 130.40/50 to the dollar compared with Friday's close of 130.75/85 in dull trade, dealers said. ($1 = 130.8000 Sri Lanka rupees) (Reporting by Ranga Sirilal and Shihar Aneez; Editing by Robert Birsel)
http://in.reuters.com/article/2012/11/12/markets-srilanka-idINL3E8MC3SE20121112

Monday, 12 November 2012 18:05 Written by Tharanga

Nov 12, 2012 (LBT) - Market continued to witness volatile sentiments as the benchmark index climbed up to touch a high of 5,615.1 points (up 25.7 points) during initial two hours of trading. Then it followed a steep dip to touch a low point of 5,591.7, before settling at 5,599.9 points with a 10.5 point advance. The liquid MPI denoted higher fluctuations as it closed with a 23.3 point gain with Browns Investments (+13.5%), Free Lanka Capital Holdings (+4%), Environmental Resources Investment (+2.9%) and John Keells Holdings (+0.9%) weighing on the index positively.

The participatory levels witnessed a sharp plunge from Friday as the turnover read mere LKR244.8 mn amidst lack of institutional play. Despite the outstanding earnings numbers flowing in (based on the company earnings released so far, market earnings have grown by 31% YoY during 3Q2012), bourse still lacks enthusiasm with only highlight has been the confidence shown by the overseas investors (YTD net foreign inflow LKR35.2 bn).

We urge the value investors to take the risk and buy into the steady counters without waiting for the next rally!Following the announcement by Environmental Resources Investment that the company has entered into a binding MOU to purchase 20% stake in Browns Investments at LKR5.5 per share, interest aroused in both the shares. Heavy retail & high net worth play in the counters led them to steal the top two positions in the day’s turnover list with both the shares witnessing heavy buying interest amidst several large on board trades. The shares closed with 2.9% and 13.5% appreciations at LKR17.4 & LKR4.2 respectively. Having recorded a 59% YoY growth in its earnings during 2QFY13, heavyweight John Keells Holdings extended interest with several large deals on board.

The counter advanced 0.9% at its close of LKR216.9. Buying interest was also visible in Cargills (Ceylon) with the counter seeing a block of 134.3k shares being handled in the market at LKR150.0. Nevertheless, the counter closed weaker with a 0.1% dip at LKR149.8. Interest stayed in Access Engineering, whilst Colombo Dockyard also attracted some activity during the day. Renewed play was visible in plantations sector player, Namunukula Plantations in anticipation of strong earnings whilst some interest also emerged in related company Kegalle Plantations. National Development Bank and Non – voting shares of Seylan Bank & Hatton National Bank were prominent among the banking sector play.

European Stocks Fluctuate as Ministers Meet on Greek Aid: European stocks fluctuated between gains and losses as finance ministers prepared to discuss Greek aid after lawmakers approved the country’s 2013 budget. Asian shares slid, while US index futures advanced. The Stoxx Europe 600 Index (SXXP) slipped 0.1% to 270.02 as of 11:03 a.m. in London.Brent Oil Snaps Two-Day Gain as Europeans Seek Greek Deal: Brent crude halted a two-day advance in London before European finance ministers meet to discuss aid for Greece amid concern that the region’s debt turmoil will constrain fuel consumption. Brent for December settlement on the London-based ICE Futures Europe exchange was at USD109.13 a barrel, down 27 cents, as of 9:50 a.m. local time.
http://lbt.lk/stock-market/movement/2947-lbt-market-monday

The Colombo Stock Exchange continued to gain ground with indices closing in the green on Monday (12).

The All Share Price Index gained 0.18 percent, up 10.45 points to close at 5,599.88 while the Milanka Price Index of more liquid stocks closed 12.21 points higher at 5,176.19, up 0.45 percent.

Turnover reached Rs. 244.8 million.

All sectors closed in positive territory with the exception of the manufacturing sector which fell 20 points or 0.75 percent.

"The market opened the week on a mildly positive note with the ASPI rising by 0.2% to close the session at 5600, while the MPI also gained 0.5% to end at 5176. Turnover however remained low at LKR245 mn with trading in Browns Investments and Environmental Resources Investments (ERI) accounting for 29% of the day’s total, DNH Financial said.

"Amongst the winners for the day were SMB Leasing(X), Browns Investments and Miramar Beach rising by 25.0%, 13.5% and 13.4% and offsetting losses in Orient Finance, Sathosa Motors and Citizens Development(X) which declined by 13.1%, 12.0% and 7.9% respectively."

Meanwhile, the Colombo Stock Brokers’ Association (CSBA) releasing a statement yesterday hailed the 2013 budget praising the President, Treasury Secretary and SEC Chairman.

"We are elated that the important and the urgent need to develop the capital market has been duly recognized by His Excellency as the Finance Minister. The key proposals announced in the Budget impacting the capital market demonstrate the desire of the government to see a vibrant capital market in the immediate future. We are also grateful to Dr.P.B.Jayasundara ,the Secretary to the Treasury, , for giving due considerations to the urgent needs of the capital market when formulating the budget proposals for 2013."

The association said the budget proposals (see The Island Financial Review of November 9, 2012) would help the market intermediaries to evolve into full fledged brokerage houses on par with their peers in the international arena. "Proposals impacting the debt market and the unit trust industry are also very encouraging," it said.

"The CSBA is extremely happy that the H.E. President has proposed to appoint a Presidential Task Force to implement a Capital Market Development Master Plan. We see this as the most important proposal impacting positively on the capital market. Therefore we thank H.E. the President for the long term vision to create and nurture a capital market that would contribute towards nation building."

The CSBA was widely seen as one party among money that exerted pressure on the regulator during the tenure of Ms. Indrani Sugathadasa and Mr. Tilak Karunaratne, who both resigned on alleged pressure from certain high net worth individuals and their "crony brokers" when the regulator took tough measures to curb market irregularities.

Four broker firms had broken away from the association in disgust.
http://island.lk/index.php?page_cat=article-details&page=article-details&code_title=65910