Colombo stock market loses steam but turnover robust

• New favourite Lanka IOC share crosses Rs. 200 mark to close at all-time high of Rs. 228.25 and dominate turnover with 28% share

The Colombo stock market ran out of steam yesterday with both indices closing lower though turnover remained robust.

The active S&P SL20 Index dipped by 1% and the benchmark ASPI by 0.4%. Turnover was Rs. 4.1 billion involving 129.2 million shares.

The market also saw net foreign selling yesterday ending the positive run in recent weeks.

Asia Securities said the indices snapped a five-day gaining streak mainly due to price losses recorded in heavyweight stocks EXPO (-2.0%), LOLC (-4.2%), LOFC (-9.4%), JKH (-1.6%), and COMB (-3.2%).

However, LIOC ended with a sharp 10% gain while CIC.N (+6.9%), CIC.X (+6.8%), ALUM (+7.1%), and DPL (+28.8%) also witnessed a strong session and cushioned the decline in the ASPI to some extent. LIOC accounted for nearly 28% of turnover (Rs. 1,158 million) on the back of heavy retail and HNI activity.

Following a 42-point gap-up to 9,408, the ASPI reversed course and slipped into negative territory, eventually closing at 9,330 (-36 points). The breadth of the market closed negative with 83 price gainers and 122 decliners.

Asia also said foreigners recorded a net outflow of Rs. 103.9 million while their participation declined to 3.6% of turnover (previous day 9.3%). Net foreign buying topped in EXPO at Rs. 34.1 million and selling topped in LION at Rs. 103.6 million.

First Capital said the ASPI slipped to the red zone, snapping the previous five-day rally as investors chose to be on the sideline awaiting more clarity on reforms suggested by the IMF. As a result, retailers booked profits on the selected heavy weights which significantly dragged the index down.

Although, index started on a solid footing, eventually lost the market momentum and closed for the day at 9,330, down 36 points. LIOC broke the psychological Rs. 200 level and recorded an all-time high of Rs. 228.25 while supporting the index to recover part of the losses during the session. Turnover was largely led by LIOC (Energy sector) with a sole contribution of 28%, followed by Materials sector (18%).

NDB Securities said high net worth and institutional investor participation was noted in Kelsey Developments, Lion Brewery and Ceylon Cold Stores. Mixed interest was observed in Lanka IOC, Expolanka Holdings and CIC Holdings whilst retail interest was noted in LOLC Finance, Agstar and Browns Investments.

Energy sector was the top contributor to the market turnover (due to Lanka IOC) whilst the sector index gained 9.53%. The share price of Lanka IOC increased by Rs. 21 (10.38%) to close at Rs. 223.25.

Materials sector was the second highest contributor to the market turnover (due to CIC Holdings voting and nonvoting) whilst the sector index increased by 2.26%. The share price of CIC Holdings voting recorded a gain of Rs. 5.20 (6.94%) to close at Rs. 80.10. The share price of CIC Holdings nonvoting appreciated by Rs. 3.80 (6.83%) to close at Rs. 59.40.

Expolanka Holdings and LOLC Finance were also included amongst the top turnover contributors. The share price of Expolanka Holdings lost Rs. 4.50 (2.04%) to close at Rs. 216.50. The share price of LOLC Finance moved down by one rupee  (9.43%) to close at Rs. 9.60.

Separately, Laxapana Batteries announced a first interim dividend of one rupee per share while Eastern Merchants announced a first and final dividend of 15 cents per share.