Blame it on meltdown in global markets or over regulation locally the Colombo stock market is suffering a crisis of confidence as it remained instable despite sound country fundamentals losing Rs. 11 billion in value proving Monday’s late boom was artificial.
The benchmark ASI dipped by 0.8% whilst Milanka declined sharply by 1.4% though turnover was a healthy Rs. 2.4 billion.
"Sustained selling pressure continued to overshadow the market while retailers punted on property related counters," John Keells Stock Brokers said.
The effect from crash of global markets on Monday and Asian markets yesterday may have had a toll as foreigners were net sellers to the tune of Rs. 117.5 million whilst non-nationals accounted for only 8% of the day’s turnover, a feature which has been common in recent weeks.
Best performing sector was Land & Property (+8.36%) whilst worst was Information Technology (-3.38%).
“Market failed to maintain (Monday’s) positive impetus due to profit taking on most counters which gained yesterday while the uncertainty over broker credit continued,” NDB Stockbrokers said. The turnover levels were lifted by a number of crossings, it added.
“The market ended in the red as investors booked profits causing selling pressure dampening the market sentiment. However, high retail interest was seen in selected counters which brought some vivacity to the Colombo bourse,” SC Securities pointed out.
Land and Property sector was the main contributor to the market turnover (due to Seylan Developments and East West Properties), and the sector index increased by 8.36%. The share price of Seylan Developments increased by Rs 3.30 (23.74%) and closed at Rs.17.60, while the share price of East West Properties increased by Rs.8.80 (33.98%) and closed at Rs.34.90.
Manufacturing sector also contributed significantly to the market turnover (due to Grain Elevators and Textured Jersey) and the sector index declined by 1.92%. The share price of Grain Elevators decreased by Rs.10.70 (7.41%) and closed at Rs. 132.00.