Bargain hunting keeps market buoyant

The week ended with both indices recording gains on healthy volumes largely due to the bargain hunting witnesses on selected high cap stocks. On Monday, the market started off on a positive note, carrying forward the previous Friday’s optimism along till Tuesday.

However the bourse could not retain the positive momentum with stocks inching downwards during the balance part of the week.

All Share Price Index (ASPI) closed up 10.4 points or 0.42% supported by early gains to close at 2470.4 points while the liquid Milanka Price Index (MPI) grew by a much higher 50.4 points or 1.71% to end the week at 3000.8 points.

Hayleys took center stage this week, trading substantial quantities to become the largest contributor towards the weekly activity level amounting to Rs. 734.6 million. Hayleys, which had been subjected to a string of crossings during the past three weeks, saw 5.6 million of its shares changing hands over the week with the majority of trading taking place on Tuesday and Wednesday.

The Hayleys share traded between a price range of Rs. 128 & Rs. 136 during the week, before closing up by Rs. 8.75 or 6.9% at Rs. 135 per share.

Following Hayleys in terms of market turnover was another diversified blue chip JKH, which posted a turnover of Rs. 301.8 million for the week. The counter saw almost 2.7 million shares trading during the week with the price touching a highest of Rs. 115 and a lowest of Rs. 111.25 per share, closing 0.45% lower at Rs. 111.50 on Friday.

Speculative trading continued this week on Vallibel, becoming the highest traded stock for the week.

During the week 34.8 million shares of Vallibel changed hands contributing Rs. 150.4 million towards the total weekly activity. Bulk of trading on Vallibel was witnessed on Monday after the company’s major shareholder disclosing details about a possible sellout. The share prices of Vallibel picked up during the week by Rs. 0.40 or 10.5% to close at Rs. 4.20.

Adding to the list of major contributors was another conglomerate Hemas, which posted a turnover of Rs. 107.1 million for the week. Hemas traded a total volume of 1.39 million shares for the week with share price declining by Rs. 4.25 or 5% to end the week at Rs. 81.00 per share.

Activity levels got a boost this week amid a number of crossings on selected high cap counters.

Total weekly turnover this week amounted to Rs. 1.94 billion, up by 152.5% compared to what was witnessed last week. Meanwhile the average daily turnover levels stood 102% higher this week amounting to Rs. 388.1 million compared to last week’s Rs. 192.1 million.

Foreign purchases for the week stood low at Rs. 39.2 million, down 58.4% compared to last week while foreign sales stood 123.8% higher at Rs. 241.5 million. Foreign participation remained lower this week at 7.2% compared to last week’s 13.2%. Vallibel, Siera Cables, Hayleys, JKH and Lanka Ventures were among the highest traded stocks this week.

Volatility on improved activity levels expected

Market managed to maintain the positive sentiment amidst a mix of speculative trading and a number of crossings on high cap stocks boosting the turnover levels. Week on Week (WoW) All Share Price Index (ASPI) notched up by 10.4 points while the Milanka Price Index (MPI) gained by a significant 50.4 points compared to last weeks closing levels.

SLT funds to improve market liquidity

In the week ahead we expect the market to remain active with healthy

turnover levels. Furthermore we feel trading opportunities would continue to exist in the market place thus we advise investors to be partly in cash to exploit these prospects.

In addition, the investors who accepted the mandatory offer of SLT received their funds during the latter part of this week. In our opinion this would improve the market liquidity that was mopped up as a result of share issues by two insurance companies Janashakthi and Ceylinco.

“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.

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