Bourse dips after early gain

Wednesday, 11 May 2011 00:00 - - {{hitsCtrl.values.hits}}

The Colombo stock market finished on a negative note failing to maintain the positive momentum enjoyed in early trading.

“Indices closed in red after gaining during early trading, as prices depreciated in illiquid stocks. However, a reaction for positive earnings results was witnessed to a certain extent,” NDB Stockbrokers said.

The ASPI dipped by 0.5% and MPI by 0.3% whilst turnover was Rs. 1.57 billion. Foreigners who were net buyers for the past five days of May, turned net sellers yesterday. The Bank, Finance & Insurance sector was the main contributor to the market turnover (mainly due to Nation Lanka Finance and Lanka Ventures) with the sector index decreasing 0.37%. Nation Lanka Finance was the main contributor to the market turnover. The share price increased by Rs 0.70 (4.46%) and closed at Rs 16.40.

The Manufacturing sector also contributed to the market turnover (mainly due to Pelwatte Sugar) with sector index decreasing 0.26%.

The share price of Ceylon Cold Stores increased by Rs. 50.10 (6.30%) amidst an announcement of a proposed sub-division and a rights issue. Union Assurance also gained by 11% on its sub division move. Sri Lanka Telecom gained by 3% to Rs. 59 on impressive first quarter earnings.

Reuters said shares wavered on Tuesday led by illiquid large caps amid retail profit-taking and foreign outflows, while the rupee closed steady.

Illiquid Lanka Ashok Leyland, a motor vehicle importer and distributor, large cap oil palm firm Bukit Darah, and conglomerate Carson Cumberbatch drove the overall index down with closing down 16.7 percent, 1.8 percent, and 0.9 percent respectively. Foreign investors were net sellers for the day, ending inflows in five straight sessions, selling 78 million rupees’ worth of shares on Tuesday. They have sold a net 5.79 billion in 2011, and a record 26.4 billion in 2010.

The bourse is still Asia’s best performer in 2011 with a 10.6 percent gain, after bringing in the region’s top gain, 96 percent, last year.

The rupee ended steady at 109.77/78 a dollar as a state bank, through which the Central Bank directs the market, sold dollars at 109.80, the high end of the Central Bank’s dollar trading band amid importer dollar demand, dealers said.