State funds buy into Browns but Bourse dip persists

Friday, 8 October 2010 01:29 - - {{hitsCtrl.values.hits}}

Several state funds entered the market yesterday with a mandate to “buy” but the Bourse closed negative for the fourth consecutive day.

State entities such as Bank of Ceylon, NSB and EPF were actively buying which to a greater degree boosted the turnover to Rs. 2.6 billion as well as checkmated a free fall in the market. Overall yesterday’s market characterised a see-saw with multiple gains and dips. ASPI was down 1.3% and MPI by 1.4%. The market has lost 5.3% in four straight sessions on correction.

Trades on 1.46 million illiquid shares of Brown and Company for Rs. 369 million were the biggest and on the buying side were state entities including Bank of Ceylon. Browns saw three crossings (493,300 shares at Rs. 250 and 104,200 at Rs. 255) taking place. However the price decreased by Rs. 5.10 (1.97%) and closed at Rs. 255.

John Keells Holdings also contributed Rs. 195 million in turnover with slightly over half a million shares traded. The price depreciated by Rs. 5 (1.52%) and closed at Rs. 324.

“Indices continued the downward trend while the prices were exceptionally volatile during the day. Indices were in the green for a brief period during the day. It seems the investors are realising some of the exceptional profits made over the last few weeks,” NDB Stockbrokers said.

“The indices ended lower with the market witnessing a day of sharp volatility as a result of a mix of bargain hunting as well as selling pressure in a bid to bring down excessive margin positions,” John Keells Stock Brokers said.

Best Performing Sector was services (+0.71%) whilst worst performing was Footwear and Textiles

(-4.32%)

Banks Finance & Insurance and Trading sectors were the highest contributors to the market turnover while sector indices declined 1.18% and 0.58% respectively.

Market also saw two other major crossings 175,000 shares of Commercial Bank at Rs. 270 and 2,000,000 shares of John Keells Hotels at Rs. 21.