Profit taking ends CSE’s 12-day winning streak; foreigners turn net buyers

The Colombo stock market yesterday ended its 12-day winning streak amidst robust activity as investors took profit.

The more active S&P SL20 Index declined by 2% and the benchmark ASPI by 1%. Turnover amounted to Rs. 5.4 billion involving 223 million shares.

Asia Securities said following 12 consecutive sessions in the green, the market witnessed a pullback yesterday with profit taking seen in active counters.

It said counters such as EXPO, BIL, LOLC and HAYL, which have seen significant interest recently, closed lower following the session. Turnover remained strong, supported by retail and HNI activity. LIOC and EXPO accounted for a sizable portion of volumes (40.9% of turnover), however activity remained more broad based as seen over previous sessions.

The ASPI opened higher at 9,278, dipping to 9,060 and recovering to 9,180 during the first hour of trading. Subsequently the index saw a further dip to 9,029 before recovering to an extent and stabilising at higher levels. LIOC (+15 points) and ACL (+9 points) were the top positive contributors to the ASPI while COMB (-16 points), HAYL (-15 points) and LOLC (-10 points) led the decline in the index. Market breadth was negative with 80 counters gaining and 133 declining.

Asia also said foreigners recorded a net inflow of Rs. 136.8 million while their participation declined marginally to 2.3% of turnover (previous day 3.1%). Net foreign buying topped in HUNA at Rs. 54.8 million and selling topped in BFL at Rs. 11 million.

First Capital said the Bourse slid back to the negative territory after four-weeks of continuous gains on the back of profit taking on multiple counters.

“The CSE gained more than 1,400 points during the past two weeks. With no more earnings news coming to the market, as all earnings releases for 22 June quarter ended on Tuesday, investors were tempted to book profits at the current elevated prices to secure their gains. As a result, ASPI closed at 9,086 losing 105 points,” First Capital said. However, with no downward revision to oil prices as anticipated, LIOC continued its positive momentum throughout the session.

Turnover was broadly par with Monday’s level while positioning well above the monthly average turnover of Rs. 2.5 billion. Energy sector continued to dominate the turnover contributing 29%, followed by Capital Goods and Food, Beverage and Tobacco sectors which produced a joint contribution of 35.0%. Despite low participation, foreign investors turned net buyers after three back-to-back sessions of net foreign outflows.

NDB Securities said high net worth and institutional investor participation was noted in Hunas Holdings, Hela Apparel Holdings and John Keells Holdings. Mixed interest was observed in Lanka IOC, Expolanka Holdings and ACL Cables whilst retail interest was noted in Browns Investments, SMB Leasing and EML Consultants.

Energy sector was the top contributor to the market turnover (due to Lanka IOC) whilst the sector index gained 6.20%. The share price of Lanka IOC increased by Rs 11.50 (6.88%) to close at Rs. 178.75.

The Capital Goods sector was the second highest contributor to the market turnover (due to ACL Cables) whilst the sector index decreased by 0.47%. The share price of ACL Cables recorded a gain of Rs 9.80 (14.50%) to close at Rs. 77.40.

Expolanka Holdings, Browns Investments and LOLC Holdings were also included amongst the top turnover contributors. The share price of Expolanka Holdings lost Rs 5.25 (2.33%) to close at Rs. 219.75. The share price of Browns Investments moved down by 20 cents to close at Rs 8.70. The share price of LOLC Holdings declined by Rs. 14.75 (2.36%) to close at Rs. 611.50.