Foreign buying a silver lining in Bourse

Monday, 18 October 2010 22:24 - - {{hitsCtrl.values.hits}}

Foreign buying yesterday was a silver lining in the Colombo bourse which otherwise closed flat midst relatively low turnover.

The ASPI ended nominally weaker by 4.27 points or 0.06 percent at 6,622.59 but foreign investors bought a net Rs. 105.2 million.

However they have overall sold Rs. 19.68 billion this year.

“The indices ended the day on a mixed note amid active foreign participation,” John Keells Stock Brokers said. NDB Stockbrokers said “Bearish sentiment continued from last week, as ASPI closed marginally higher.

Sentiment may improve once the earnings season gathers momentum, plus the optimism on budget proposals in mid-November.”

“High volatility was witnessed in the Colombo Bourse during the day where the market ended the day on a negative note,” Asia Securities said.

Distilleries spearheaded the market contributing for about 23% of day’s turnover on the back of institutional and high net worth interest. Sampath Bank and Colombo Dockyard witnessed high net worth and institutional participation during the day whilst heavy weight John Keells Holdings traded on the back of high net worth interest. Further institutions were seen active on Commercial Bank.

Beverage Food & Tobacco and Bank Finance & Insurance sectors were the highest contributors to the market turnover, while the sector indices increased by 1.23% and 0.70% respectively. Best performing sector was Construction and Engineering (+3.64%) whilst the worst was Stores & Supplies (-6.54%).

NDB said that Distilleries was the highest contributor to the market turnover with three crossings of 1,900,000 shares at Rs. 180. The price increased by Rs. 10 (5.78%) and closed at Rs. 182. Foreign holdings of the company increased by 977,100 shares.

Sampath Bank also contributed to the market turnover with a crossing of 400,000 shares at

Rs. 250, while the price increased by Rs. 2.40 (0.96%) and closed at Rs. 252.10.

Another three crossings were also recorded for 65,000 shares of John Keells Holdings at Rs. 310 and 300,000 shares of Colombo Dockyard at Rs. 280 and 100,000 shares of Hayleys at Rs. 340.

It still remains Asia’s best performer in 2010 with a 95.6 percent gain as the island’s economy rebuilds after the end of the civil war in May 2009. It has shed 8.1 percent since hitting an all-time high of 7,207.75 on 4 October.

The CSE’s 14-day relative strength index is at 54.1, between the neutral limits of 30 and 70, Thomson Reuters data showed.

It is also trading at the highest forward price-to-earnings ratio in Asia and global emerging markets at 21.5 times, compared with 13.5 and 12.6 respectively, Thomson Reuters data showed.

The rupee weaker at 111.85/88 a dollar from Friday’s 111.80/85, on importer demand for dollars, dealers said.