Plantations boost market sentiment

The positive outlook on the plantations industry helped market to continue on its positive momentum with both indices recording gains.

The improved market sentiment saw stock prices surge during most part of the week, except on Friday where the ASPI (All Share Price Index) drifted downward on the back of profit taking witnessed in the market.

The MPI (Milanka Price Index) meanwhile remained on a positive note throughout the week. Week on week the ASPI gained 25.7 points or 1 per cent to close at 2510.8 while the more sensitive MPI closed up 31.1 points or 1 per cent at 3163.8 points.

Leading this week’s market activity was the plantation counter, Maskeliya with a contribution of Rs. 162 million, reflecting almost 11 per cent of the weekly activity.

The counter also became the 2nd highest traded stock for the week having traded 6.5 million shares in volume. Maskeliya closed the week at Rs. 26.50, up considerably by 17.8 per cent as against last Friday’s close of Rs. 22.50 per share.

Following closely was another plantation stock, Balangoda, which witnessed a significant price appreciation of 33 per cent over the week.

During the week 4.2 million Balangoda shares traded between a wide price band of Rs. 26.75 and Rs. 37, before closing Rs. 8.75 higher at Rs. 35 per share. The Stock’s Contribution to the market activity amounted to Rs. 137.3 million.

Lanka Cement came in 3rd in terms of activity levels with a turnover of Rs. 125 million accounting for 8.4 per cent of total turnover.

The share price of Lanka Cement surged by a 21.7 per cent WoW to close at Rs. 14 per share.

Approximately 8.6 million of Lanka Cement shares were seen trading within the price range of Rs. 11.50 and Rs. 17 per share.

Apart from Maskeliya and Balangoda the other plantation stock to capture high investor attention was Madulsima demonstrating an activity level of Rs. 95.1 million towards the weekly turnover.

Madulsima witnessed a sizeable improvement of the price of its share by 44.4 per cent to close at Rs. 16.25 after trading at a lowest price of Rs. 11.50 and a highest price of Rs. 19.50 per share. During the week 5.9 million Madulsima shares traded.

Total turnover during the 4 day trading week stood at Rs. 1.49 billion, lower than last week that consisted 5 days of trading, however the average daily turnover stood at Rs. 372 million showing this week, 1.8 per cent higher compared to last week’s Rs. 365.7 million.

Foreign investors were net buyers this week amounting to Rs. 103.7 million.

Foreign purchases for the week stood at Rs. 297 million, while foreign sales totaled Rs. 193 million. Comparing WoW foreign purchases and foreign sales were down by 80 per cent and 72 per cent respectively. Foreign participation, which stood high at 47 per cent last week dropped significantly to 16.5 per cent of total activity this week.

Lanka Cement, Maskeliya, Madulsima and Balangoda were among the heavily traded stocks for the week.

Trading opportunities to exist

Market remained active with investors capitalizing on trading opportunities in the market place.

As expected, plantation sector counters were the main attraction during the week with most of these stocks experiencing significant price appreciations. Over the 4 days of trading during the week market gained by 25.7 points compared to last Friday’s closing level.

In the week ahead we expect the market to remain active with investors mainly focusing on trading opportunities in the market place.

However we do not rule out the possibilities of profit taking when it comes to plantation sector counters as investors are likely to book profits after sharp gains witnessed over the last 2 weeks. Thus we advise investors to carefully select stocks when involving in trading while accumulating stocks that have done well financially.

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