YTD net foreign inflow at CSE reaches nine-year high of Rs. 18 b but locals remain bearish

The Colombo stock market remained bearish with both indices down by over 0.6% amidst low turnover but bullish foreign investors ensured year to date net inflow reached the record Rs. 18 billion mark yesterday. Turnover was Rs. 1.2 billion involving 50 million shares.  Net foreign buying amounted to Rs. 105.5 million boosting the figure so far in 2022 to Rs. 18 billion, highest since 2013 when CSE drew Rs. 22.7 billion in net foreign inflow.

Last year net foreign outflow was Rs. 53 billion and in 2020, it was Rs. 51 billion and Rs. 11.7 billion and Rs. 23 billion in the preceding year. The previous net inflow was in 2017 at Rs. 17.6 billion.

The indices closed in red for a second straight session on Thursday (03) largely due to price losses in EXPO (-2.8%), SAMP (-2.9%), DIPD (-1.6%), RCL (-1.0%), AEL (-3.8%), and AAIC (-5.8%).  Turnover remained moderate at Rs. 1,190 million (previous session-Rs. 1,195 million) with trading volume totalling 50.2 million shares (previous session-36.4 million shares). EXPO (Rs. 229 million), CARG (Rs. 206 million), and BIL (Rs. 100 million) topped the turnover list for the day. Overall breadth of the market remained negative with 49 price gainers and 133 decliners.

Foreigners recorded a net inflow of Rs. 105.5 million while their participation increased to 6.0% of turnover (previous day 3.3%). Net foreign buying topped in SPEN at Rs. 77.8 million while selling topped in MELS at Rs. 6.8 million.

The Bourse dipped further in red as negative sentiment continued to persist among investors while participation slid low ahead of the budget 2023. Although ASPI moved positively during the initial hour, subsequently it began to plunge steeply as the SAMP and EXPO selling spree brought down the index and closed for the day at 8,509 losing 53 points. However, retail favourite LIOC witnessed some buying during the latter part of the session upon the power and energy minister’s statement confirming there will be no fuel price revisions during the week.

Turnover was 41% less than monthly average of Rs. 2 billion while Transportation sector (19%) dominated the overall turnover followed by the Food and Staples retailing sector (18%), led by the off-board transaction of CARG amounting to Rs. 205.7 million following Associated Newspapers of Ceylon Ltd. selling their stake of 914,103 shares (0.35%) at Rs. 225 each.

NDB Securities said high net worth and institutional investor participation was noted in Cargills and Browns Investments. Mixed interest was observed in Expolanka Holdings, Aitken Spence and Lanka IOC whilst retail interest was noted in Dipped Products, Royal Ceramics and CIC Holdings.

Transportation sector was the top contributor to the market turnover (due to Expolanka Holdings) whilst the sector index lost 2.83%. The share price of Expolanka Holdings decreased by Rs. 4.75 (2.83%) to close at Rs. 163.

Food and Staples Retailing sector was the second highest contributor to the market turnover (due to Cargills) whilst the sector index closed flat 0.00%. The share price of Cargills closed flat at Rs. 200.

Browns Investments, Aitken Spence and Lanka IOC were also included amongst the top turnover contributors. The share price of Browns Investments moved up by 10 cents to close at Rs. 6.10. The share price of Aitken Spence recorded a gain of Rs. 2.00 (1.52%) to close at Rs. 134. The share price of Lanka IOC appreciated by Rs. 2.75 (1.56%) to close at Rs. 179.