MBSL Midcap Index on upward momentum

The MBSL Midcap Index is on an upward momentum, indicating a widened range compared to ASPI and MPI indices. Market earnings potential in the new era of positive momentum and the increase in tourism were driving most of the medium market capitalization companies while sector based favourable conditions have been driving most of the equity counters in the Colombo Stock Exchange.

Although both the ASPI and MPI have moved on the upward momentum during the period concerned the Merchant Bank’s Midcap Index has grown in a considerable manner.

When compared with the previous year June ASPI, it improved by 122 percent with the overall market capitalizations improving and more counters getting the listings on the Board.

The Milanka Price Index which covers the sensitive counters in the market improved by 121 percent indicating that the strong holds have grown in a similar pattern to the ASPI.

Midcap index on the other hand has moved by 115 percent against June 1, 2010.

The midcap index has moved on a lower percentage to the ASPI and Milanka index.

This is an indication for strong midcap companies to have growth prospects for the future and from the business opportunities arising from the Eastern and Northern provinces.

The MBSL Midcap index which was launched in 1999 is revised annually based on three broad criteria in selecting twenty five stocks for the index.

MBSL changed its Midcap Index with effect from January 4, 2010 based on Market capitalization - medium scale entities, Liquidity of the stock, Profitability during the last two years.