The Bourse Weekly Performance (Week ended July 19th, 2013)

LSS Weekly Market Review

Market opened a fresh week with a mixed sentiment where shares in ASI extended losses to end 0.2% down. Index closed at 6,015.54, a drop of 13.54 points. However, S&P SL 20 Index managed to gain 12.01 points (+0.35%) with the support of the price appreciations in Carsons Cumberbatch, Commercial Bank, and Chevron Lubricants. Market turnover was LKR 441mn. Dialog Axiata emerged as the top contributor to the daily turnover with LKR 195mn. PC House traded heavily during the day. Two crossings were recorded from Dialog Axiata where 22mn shares changed hands at a price of LKR 8.80 per share. Foreign participation was 35% and foreign investors ended as net buyers with a net inflow of LKR 260mn.

On Tuesday Market ended the daily operations in red where benchmark All  Share Index and S&P SL 20 Index  dropped marginally by 7.55 points (-0.13%) and 11.02 points (-0.32%). Daily market turnover was LKR 738mn. John Keells Holdings was the top contributor to the market with LKR 341mn. There were three crossings recorded from John Keells Holdings, Sampath Bank and Commercial Bank. Total value of the crossings accounted for 52% of the total market turnover. Namunukula Plantations heavily traded stocks for the day. Namunukula and Kegalle Plantations announced interim dividends of LKR 9.00 and LKR 12.00 per share respectively. Kegalle Plantations reached intra-day high of LKR 118.00 (+10%) while Namunukula Plantations reached intra-day high of LKR 86.00 (+14%). Colombo Land & Development was also traded heavily during the day. Foreign participation for the day was 36% of the total market activity and at the end of the trading foreign investors were net buyers with a net inflow of LKR 421mn.

Colombo stocks further dropped on Wednesday where benchmark All  Share Index and S&P SL 20 Index  dropped by 25.30 points (-0.42%) and 9.69 points (-0.29%) respectively. Anilana Hotels and Properties Limited commenced its secondary trading and the stock reached intraday high of LKR 13.50 & stock closed at LKR 10.50 (-12.5%). Daily market turnover was as LKR 192mn. One crossing was recorded in Hatton National Bank where 0.25mn shares changed hands hands at a price of LKR 154.00 per share. Accordingly Hatton National Bank with LKR 39mn emerged as the top contributor to the market. Waskaduwa Beach Resort traded heavily followed by Kalpitiya Beach Resort and Anilana Hotels. Foreign participation for the day was 14% of the total market activity and at the end of the trading foreign investors were net buyers with a net inflow of LKR 14mn.

Market closed in green territory on Thursday where positive returns were recorded in both indices. Board market index closed with a marginal gain of 3.10 points (+0.05%) and S&P SL20 Index gained 2.00 points (+0.06%). Price appreciation in the premier blue-chip Nestle contributed positively to the index performances. Market turnover was LKR 665mn. John Keells Holdings with LKR 260mn emerged as the top contributor to the market turnover. Several off-the-floor deals recorded in Aitken Spence, John Keells Holdings and NDB. PC House Holdings was the heavily traded stocks for the day. Foreigners were net buyers of LKR 349mn worth of shares and foreign participation accounted for 48% of the market activity.

Market wrapped the weekly operations on Friday on positive note. ASI closed at 6,041.06, up by 55.61 points (+0.93%) and S&P SL 20 Index end at 3,409.16, up by 30.43 points (+0.90%). The indices posted notable gains due to price appreciations in index heavy counters such as John Keells Holdings (LKR 260.10,+4.2%) , Sri Lanka Telecom (LKR 41.00,+4.6%) and NDB Capital (LKR 490.00,+6.5%). Daily market turnover was LKR 719mn. Total value of the crossings accounted for 47% of the market turnover. John Keells Holdings with LKR 324mn, Sampath bank with LKR 106mn and Sinhaputhra Finance with LKR 75mn were the top contributors to the market turnover. John Keells Holdings, Vallibel One & Sinhaputhra Finance were the actively traded stocks during the day. Foreign participation was 18% and foreign investors were net sellers with a net outflow of LKR 184mn. Net foreign outflows were seen in stocks such as John Keells Holdings, Sampath Bank and Nations Trust Bank. Cash map closed at 71.01%.

More reading -http://research.srilankaequity.com/t781-19-07-2013-weekly-review-asia-wealth-management-co-ltd


The indices rose sharply during the last day of the week breaking the long prevailed lethargic momentum on the back of few selected blue chip counters gaining points. The ASI gained 12.3 points WoW to close at 6,041.1 points (+0.2%), whilst the S&P SL20 Index gained 23.7 points WoW to close at 3,409.2 points (+0.7%). Indices benefited mainly on the back of gains made by John Keells Holdings (+4.0% WoW), Sri Lanak Telecom (+2.5% WoW), Carsons Cumberbatch (+1.9% WoW), Chevron Lubricants (+4.0% WoW) and Commercial Bank of Ceylon (+1.4% WoW).

The bourse headed south during the first three days of the week with majority of the counters losing grip. However, it managed to gain momentum on Thursday and rose sharply during Friday’s trading mainly due to diversified giant John Keells Holdings gaining c.4.2% reporting the highest number of trades for the day. Moving in tandem, majority of the counters also witnessed a strong recovery in their prices during the day strengthening the bourse to gather more points. The activities of both the local and foreign investors remained subdued during the beginning of this week, however it recovered towards the latter part of the week with net foreign inflow substantially increasing to LKR860.2mn during the week.

Further, ADB brought down its Asian growth outlook for 2013E to 6.3% YoY from 6.6% YoY after China releasing its GDP growth for 2Q2013 which stood at 7.5% YoY which is a slow down for the second successive quarter. However ADB is optimistic on Sri Lanka’s growth prospects and expects the economy to grow at 6.8% YoY in 2013E and 7.2% YoY in 2014E. It further stated that this growth momentum is expected to be supported by further monetary policy easing and improvement in power generation which will drive the domestic industry growth.

During the week the shares of Anilana Hotels and Properties which were issued at LKR12.0 via IPO made its debut trading on Wednesday at the CSE. The shares reached a high of LKR13.50 during the first day but gradually lost grip to close the week at LKR10.30.

Further, Telco company Dialog Axiat a crossing of 22mn shares at LKR8.8 with possible foreign investor participation, whilst Diversified counters such as John Keells Holdings, Aitken Spence and Banking counters Sampath Bank, Commercial Bank, Hatton National Bank and National Development Bank also witnessed crossings.

Furthermore, Dialog Axiata, PC House, John Keells Holdings, Touchwood and Blue Diamonds (non-voting) topped the list in terms of volume traded during the week.

The week saw foreign purchases amounting to LKR 1,325.9 mn whilst foreign sales amounted to LKR 465.7 mn. Market capitalisation stood at LKR 2,324.8bn and the YTD performance is 7.0%.

Foreign investor interest regains momentum, whilst possibility of a further rate cut looms..
The market ended the week in the green breaking a 7-week WoW losing streak which saw the ASI’s YTD performance halving over the period.

However, this turnaround came about in the 11th hour on account ofinstitutional interest in John Keells Holdings which dragged the index up to record a WoW gain. This contrastedwith the USD/LKR exchange rate which depreciated over the week and reached a 10 week low on Wednesday. Thiswas despite the heightened open market operations conducted by the Central Bank in the aftermath of the revision made to the reserve ratio. The Central Bank governor attempted to reassure financial markets by providing some forward guidance with regard to policy rates stating that if the inflation rate and growth rates remain at manageable levels, a further cut in policy rates would be a possibility in September-October. This is possibly in response to the fact that several rounds of monetary easing coupled with the CBSL’s moral suasion have failed to produce a material impact on market interest rates. In spite of these developments foreign investors have been net buyers into equities during the week with a net foreign inflow of LKR860.2 mn reversing the previous week’s subdued performance which could be regarded as foreign investors confidence in the future prospects of the equities market.

http://www.sundayobserver.lk/2013/07/21/fin48.asp