Stock market ends week on positive note

The Colombo stock market yesterday ended a shortened week on a positive note with healthy turnover supported by strategic and retail buying.

Gain yesterday was slightly below 0.5% for the benchmark ASPI but it finished the week up 1% whilst MPI rose by 2%.

“Buying interest started to build during the day as indices gained slightly,” NDB Stockbrokers said.

Diversified and Bank Finance & Insurance sectors were the highest contributors to the market turnover. Diversified sector index decreased by 0.34% while Bank Finance & Insurance sector index increased by 1.08%.

Premier conglomerate John Keells Holdings (JKH) was the highest contributor (Rs. 1.2 billion with 4 million shares traded) to the market turnover with nine crossings of 3,340,000 shares at Rs. 300. The price decreased by Rs. 1.50 (0.49%) and closed at Rs. 302.00.

Distilleries also contributed to the market turnover with six crossings of 2,216,100 shares at Rs. 180 while the price decreased by Rs. 2.00 (1.09%) and closed at Rs. 181.00. Foreign holding of the company increased by 1,000,000 shares.

Four crossings were also recorded for 8,500,000 shares of Vallibel Power Erathna at Rs. 10 and 244,532 shares of Sampath Bank at Rs. 260.

A Reuters report said whilst ASPI rose foreign investors sold over 1.2 billion rupees’ worth of mainly blue chip shares due to high valuations.

Despite the fact the market has almost doubled this year; foreign investors have so far this year sold a net 22.9 billion rupees’ worth of shares.

Colombo is still Asia’s best performer in 2010 with a 97.5 percent gain as the island’s economy rebuilds after the end of a civil war in May 2009. It has shed 7.2 percent since hitting an all-time high of 7,207.75 on 4 October. The bourse is trading at the highest forward price-to-earnings ratio in Asia and global emerging markets at 20.8 times, compared with 13.5 and 12.6 respectively, Thomson Reuters data showed.

The CSE’s 14-day relative strength index is at 56.4, between the neutral limits of 30 and 70, Thomson Reuters data showed.

Bank shares which brought down the market in the previous session boosted the market index with a more than 1.7 percent growth in top listed lender Commercial Bank of Ceylon and the second-biggest lender Hatton National Bank, Reuters said.

The rupee closed firmer at 111.76/78 a dollar from Wednesday’s 111.82/85 on banks selling dollars amid a lack of importer demand ahead of a long weekend. The markets will be closed on Friday for a Buddhist religious holiday.