Stock market surge persists amid high turnover

• Bullish run continues but loses steam post mid-day
• ASPI upward momentum intact after briefly topping 8,900-points level; YTD gain nears 30%
• Investor battle on LOLC v. Expolanka continues
• Value gap between LOLC and Expo gets thinner by Rs. 129 m, but percentage wise both equal at 6.17% of CSE's market cap
• Market sees renewed interest in Hayleys with past 2 weeks’ quantity traded in a day

The Colombo stock market sustained its bull run for the third consecutive day with both indices up amid above average turnover.

The All Share Price Index gained by 1% or over 88 points and the S&P SL20 improved by eight points. The ASPI's year-to-date (YTD) gain is nearing 30% at 29.26%, while S&P SL20 return is 20.68%.

Turnover recorded was the lowest for the week but was still a high Rs. 7.3 billion involving 287.8 million shares.

The investor battle on LOLC and Expolanka extended further with just a mere Rs. 129 million difference between the two in terms of value.

After the price dip on Tuesday, Expolanka Holdings saw return of investor interest with 12 million of its shares changing hands via 3,658 trades for Rs. 1.46 billion. The share bounced back to Rs. 122.75, up by Rs. 2.75. Expo’s market capitalisation was Rs. 239.9 billion. Foreign holdings at Expo decreased by 265,000 shares.

In contrast, LOLC wasn’t sought after yesterday as only 898,776 shares changed hands via 1,004 trades for Rs. 457 million. The price dipped marginally by Rs. 2.25 to Rs. 505.25 and its market capitalisation was Rs. 240 billion. 

However, related parties figured among top turnover generators. They were LOLC Finance (Rs. 738 million), Commercial leasing (Rs. 682 million) and Browns Investments (Rs. 457 million). Group entity Eden Hotel Lanka also figured fourth highest among volume leaders with 13.6 million traded for Rs. 250 million and share price up 19% to Rs. 18.

Diversified blue chip Hayleys saw an unusually high volume of trading with price gaining by 4%.

Over 8.18 million of Hayleys shares changed hands via 2,873 trades for Rs. 763.3 million. The price closed at Rs. 92.30, up by Rs. 3.60 or 4%.  

Volume traded yesterday amounted to the combined quantity of Hayleys shares traded in the past two weeks and the entirety of the week ended 6 August. In July, Hayleys saw 16.67 million shares changing hands via 5,766 trades for Rs. 1.35 billion, while price gained by Rs. 8.54.

First Capital said the bourse traded in the green territory for the third straight day, crossing the 8,900-mark.

“Index displayed a volatile uptrend during the early hours of trading, reaching an intraday high of 8,944. However, selling pressure emerged by mid-day, which wiped off most of the gains as investors chose to book profits and adopt a cautious stance after the index breached the psychological barrier of 8,900,” First Capital said, adding: “Nevertheless, bulls managed to hold on to their positions, closing at 8,757.”

It said turnover was led by the Diversified Financials sector, followed by the Transportation sector, accounting for a joint contribution of 48%.

Asia Securities said as market continued its rally during the first half of the session, the ASPI crossed the 8,900 level and recorded a new all-time high of 8,938 before witnessing a pull-back due to profit-booking at higher levels. The index commenced trading declining to an intra-day low of 8,667 following a 117 point gap-up, however subsequently picked up on the back of buying support extended by retail investors in CLC which pushed the index to surpass the 8,900 level during the session. 

CLC, the highest contributor to the index with 68 points, gained up to Rs. 38.90 (+48%) from Rs. 26.20 during the session before investors began to book profits in the stock which dragged the ASPI down from its high to below the 8,700 level. 

Asia said excluding CLC, other active stocks witnessed some consolidation following the recent surge in prices. However, the ASPI ended the session with sharp gains due to a late-hour pickup while turnover remained at stronger levels. 

It also said Expo led activity as the stock saw strong buying interest from HNI investors following yesterday’s profit-taking while Mesltacrop witnessed some renewed retail buying interest during the session.

Foreigners recorded a net outflow of Rs. 116.9 million while their participation remained flat at 1.3% of turnover (previous day 1.8%). Net foreign buying topped in BIL at Rs. 5.7 million and net foreign selling topped in JKH at Rs. 47.6 million. 

NDB Securities said the ASPI closed in green as a result of price gains in counters such as Commercial Leasing and Finance, Expolanka Holdings and John Keells Holdings.

It said high net worth and institutional investor participation was noted in Sanasa Development Bank and Lanka Tiles. Mixed interest was observed in Expolanka Holdings, Hayleys and LOLC Holdings, whilst retail interest was noted in Commercial Leasing and Finance, Browns Investments and Lanka Orix Finance.

The Diversified Financials sector was the top contributor to the market turnover (due to Lanka Orix Finance and Commercial Leasing and Finance), while the sector index gained 3.33%. The share price of Lanka Orix Finance moved down by Rs. 0.90 (7.14%) to close at Rs. 11.70. The share price of Commercial Leasing and Finance recorded a gain of Rs. 4.80 (18.32%) to close at Rs. 31.

The Transportation sector was the second highest contributor to the market turnover (due to Expolanka Holdings), while the sector index increased by 2.28%.