CSE remains bearish despite macro positives

The Colombo stock market persisted with its bearish run amidst poor investor sentiment and resultant low activity despite the boost from the deal with the International Monetary Fund and other positives.

The active S&P SL20 declined by 0.8% and the benchmark ASPI by 0.5%. The decline however was lower in comparison to Monday's loss of over 1%. Turnover yesterday was Rs. 860.5 million involving 44 million shares, same as Monday.

Asia Securities said after a sharp sell-off, the indices reversed losses on the back of a late recovery on Tuesday as investors resorted to bargain buying in front-line stocks cashing in on lower prices. Spurred by the Government’s announcement on new entrants into the fuel industry, LIOC witnessed heavy selling pressure at market open which, in turn, triggered a broad-based sell-off in early trading. 

Notable price declines were recorded by LIOC (-1.5%), EXPO (-1.1%), ACL (-1.3%), SCAP (-1.7%), and BIL (-3.1%). As such, the ASPI declined to an intra-day low of 9,179 (-106 points) before rebounding to 9,233 (-52 points) at the back-end of the session. TKYO (+1.3%), DIST (+1.0%), HAYL (+1.1%), PACK (+2.1%), DIAL (+1.0%), HOPL (+4.0%), and CICX (+1.4%) closed in green supported by steady retail and HNI buying. 

VONE (-11 points), JKH (-9 points), and HNB (-5 points) ended as the biggest laggards on the ASPI. The breadth of the market remained negative with 62 price gainers and 111 decliners. 

Turnover was led by LIOC (Rs. 104 million), EXPO (Rs. 87 million), and ACL (Rs. 83 million). 

Asia also said foreigners recorded a net inflow of Rs. 15.2 million. Net foreign buying topped in SAMP.N at Rs. 35.5 million whilst selling topped in ACL.N at Rs. 39.4 million.

First Capital said the bourse ended the day in the red zone at 9,233 losing 52 points as mixed sentiment was observed in turnover settlement and investors took a wait and see approach owing to market uncertainty. 

Depressed levels of turnover continued from the previous session and retail selling pressure emerged across the board on LIOC and EXPO due to month end margin calls. 

NDB Securities said high net worth and institutional investor participation was noted in National Development Bank, Sampath Bank and John Keells Holdings. Mixed interest was observed in Lanka IOC, Expolanka Holdings and ACL Cables whilst retail interest was noted in SMB Leasing nonvoting, Browns Investments and Softlogic Capital. 

The Capital Goods sector was the top contributor to the market turnover (due to ACL Cables) whilst the sector index lost 0.93%. The share price of ACL Cables moved down by Rs. 1.10 to Rs. 80.90.

The Banking sector was the second highest contributor to the market turnover (due to Sampath Bank) whilst the sector index decreased by 0.72%. The share price of Sampath Bank closed flat at Rs. 51.

Lanka IOC, Expolanka Holdings and Softlogic Capital were also included amongst the top turnover contributors. The share price of Lanka IOC decreased by Rs. 2.50 to Rs. 163.75. The share price of Expolanka Holdings lost Rs. 1.50 to Rs. 130.75. The share price of Softlogic Capital declined by 20 cents to Rs. 11.50.