Market heads south for fifth consecutive week

The bourse took a beating last week as the indices fell throughout the week recording the fifth consecutive weekly drop.

Dampened investor interest led the indices to close down with losses for the week with the benchmark ASPI (All Share Price Index) falling by 44.2 points or 1.77% to close at 2455.4 points while the more liquid MPI (Milanka Price Index) reaching its lowest level for the year to stand at 2942.8 points, by losing almost 62.4 points for the week.

Hayleys was in the spotlight last week with the counter contributing almost half of the total weekly market turnover and share price appreciating by 24.5% WoW to close at Rs. 125.

On Tuesday a 6% stake of Hayleys changed hands at Rs. 125, and according to media reports the stake was sold by Carson Group companies to Vallibel Group, resulting in the counter contributing a total of Rs. 705.5 million to the week’s turnover.

Hayleys also became the highest traded stock with almost 5.7 million shares transacting during the week. The Blue Chip Distilleries came in second in terms of turnover with a contribution of Rs. 98 million towards total weekly turnover.

A volume of almost 0.95 million shares were traded within a price band of Rs. 100 and Rs. 104 before ending at Rs. 101 per share on Friday, up 0.75% compared to Rs. 100.25 at the beginning of the week.

Also trading considerable quantities apart from Hayleys was Fort Land with a trade volume of 3.13 million shares.

Despite trading large quantities during the week, the shares of Fort Land dipped 0.6% WoW to stand at Rs. 28 per share at week’s close while contributing Rs. 92 million towards the weekly turnover.

Aitken Spence was able to attract investor attention during the week with the share ending up WoW to close at Rs. 550 per share. Counter also became the fourth highest turnover generator for the week amounting to Rs. 68.2 million. During the week nearly 0.12 million shares of Aitken Spence shares changed hands.

Total turnover amounted to Rs. 1.48 billion this week, with the average daily turnover standing at Rs. 296 million.

Tuesday posted the highest daily turnover for the week amounting to Rs. 813 million driven by the Rs. 669 million contribution by Hayleys. Week on Week the market activity was up by a significant 64%.

Foreign participation dropped further this week to stand low at 5.4% of

total activity compared to 16% posted last week. Foreign purchases stood at Rs. 81.4 million, down 59% while foreign sales totaled to Rs. 77 million witnessing a decline of 12% from last week, resulting in a low net foreign inflow of Rs. 4.4 million.

Among the highest traded stocks in terms of volume for the week were Hayleys, Fort Land, Mullers and Nawaloka.

Weakening macro fundamentals to affect investor confidence.

Indices headed south for the 5th consecutive week as negative sentiment continued in the marketplace. During the week All Share Price Index (ASPI) slipped 44.2 points while Milanka Price Index (MPI) lost 62.4 points compared to last Friday’s closing level.

In the coming week we expect the market to remain negative on modest activity levels as macro factors such as high inflation and interest rates would put downward pressure on corporate performance.

Nevertheless we do not rule out the possibilities for trading, thus we advise investors to closely monitor the market to exploit these trading opportunities. Furthermore we advise investors to stick to fundamentally sound counters and accumulate these with a long-term view.

(This information has been compiled from sources that we believe to be reliable but we do not hold ourselves responsible for its completeness or accuracy. No matter published herein create any liability of any kind of HNB Stockbrokers (Private) Limited or its associates. All opinions views findings and conclusions included in this report constitute our judgment of this date and are subject to change without notice.)