Colombo stock market sustains gain; expectations high today post RW victory as President

The Colombo stock market sustained its positive run with improved activity yesterday whilst expectations are high of a more robust trading today following the election of Ranil Wickremesinghe as President.

The verdict from the Parliamentary secret ballot was announced after the market was closed yesterday.

Earlier on, both indices gained by nearly 1% whilst turnover improved to Rs. 1.34 billion involving 82.7 million shares.

Asia Securities said the indices continued on an upward trend on the back of a broad-based pick up as retail and HNI investors eyed stability on the political front following the election of the new President. 

The ASPI settled with a gain of 68 points (+0.9%) while the more liquid S&P SL20 index closed 18 points (+0.7%) higher. 

Turnover was driven by MELS (Rs. 209 million), JKH (Rs. 176 million), BIL (Rs. 174 million), and EXPO (Rs. 114 million). The ASPI opened trading with a gap-up of 48 points (+0.6%) at 7,692 and gained as much as 129 points (+1.7%) to reach an intra-day high of 7,773 in the first hour of the session. 

After hovering around the 7,750 level, the index fell 81 points from the day’s high to 7,692. However, it managed to hold above the 7,700 mark at market close. Among the active counters, EXPO (+0.1%), LIOC (+0.9%), HAYL (+3.3%), AAIC (+6.8%), and VONE (+2.2%) closed in green. The breadth of the market remained strong with 117 price gainers outnumbering 58 decliners.

Asia also said foreigners recorded a net inflow of Rs. 0.2 million while their participation increased to 16.4% of turnover (previous day 12.2%). Net foreign buying topped in ASIY at Rs. 2.6 million and selling topped in AAIC at Rs. 3.2 million.

First Capital said the bourse registered in the green for the fourth straight session as investors traded on a more optimistic note following the constitutional election of the President and on expectation of political stability that would enable the country to proceed with IMF negotiations. 

It said the Index opened on a positive note and remained bullish throughout the session, despite a slight decline towards the end, index closed positively at 7,712 gaining 68 points. Turnover improved with off-board transactions of MELS and JKH and rose by 35.4% relative to the monthly average turnover of Rs. 1 billion. 

Turnover was led by the Food, Beverage and Tobacco sector which solely contributed 42% while Capital Goods sector contributed 23%. 

NDB Securities said high net worth and institutional investor participation was noted in Melstacorp and John Keells Holdings. Mixed interest was observed in Expolanka Holdings, Lanka IOC and Hayleys whilst retail interest was noted in Browns Investments, SMB Leasing non-voting and Kotagala Plantations. 

Food, Beverage and Tobacco sector was the top contributor to the market turnover (due to Melstacorp and Browns Investments) whilst the sector index gained 1.19%. The share price of Melstacorp increased by 90 cents (2.32%) to close at Rs. 39.70. The share price of Browns Investments closed flat at Rs. 8.10.

The Capital Goods sector was the second highest contributor to the market turnover (due to John Keells Holdings) whilst the sector index edged up by 0.08%. The share price of John Keells Holdings was down by one rupee to close at Rs. 121.

Expolanka Holdings and Lanka IOC were also included among the top turnover contributors. The share price of Expolanka Holdings recorded a gain of 25 cents to close at Rs. 180.25. The share price of Lanka IOC appreciated by 70 cents to close at Rs. 77.80.