Market

Investors adopt reactionary attitude

The week saw both indices moving up marginally with the ASPI gaining 58.08 points or 0.91% and the MPI gaining 36.96 points or 0.65%. The ASPI closed at 6406.52 and the MPI closed at 5698.85.

Galadari Hotels, Hayleys Plc and HVA Foods dominated turnover in value for the week, accounting for 39.60% of aggregate turnover value. Turnover for the week saw a substantial increase in value from last week (Rs 6498.01 million) representing a W-o-W gain of over 100%. The daily average for the week amounted to Rs 1299.60 million as against last week’s daily average of Rs 679.17 mllion.

Turnover in volume grew by 59.86% as 316.35 million shares were transacted as against last week’s 158.32 million shares.

Turnover in value for the week was dominated by the Banking and Finance sector accounting for 22.41% of total turnover value or Rs 1,456.51 million. This was followed by the Diversified sector contributing Rs 1,447.54 million (22.28%). The Hotels and Travels sector, too, topped the list with a contribution of 22.17% (Rs 1,440.50 million).

Banking and Finance sector saw the most number of shares transacted accounting for 48.70% of total turnover volume with 154.06 million shares changing hands. The Hotels and Travels sector followed suit, contributing 11.67% or 37.21 million shares, while the Power and Energy sector saw 26.10 million shares changing hands (8.25%). Market Capitalization increased marginally by 0.99%, closing at Rs 2,304.16 billion relative to last week’s value of Rs 2,281.47 billion. Infrastructure Developers Plc topped the price gainers list recording a gain of 81.45% to close at Rs 180.00 from last week’s close of Rs 99.20. Serendib Land Plc closed at Rs 2230.00, gaining 48.67% from last week’s close of Rs 1500.00. Kalamazoo which closed at Rs 2850.00 also saw a 29.55% increase in price.

Beruwala Walk Inn was the major loser during the week declining 16.67% to close at Rs 160.00 from last week’s close of Rs 192.00. Huejay International Investments Plc lost 13.56% to close at Rs 146.00, whilst Bimputh Lanka Investments Plc declined 13.08% to close at Rs 45.20. Ceylon Beverage Holdings Plc and Hayleys-MGT also declined 12.73% and 9.71%, respectively.

The bourse witnessed net foreign inflows for the second consecutive week, with a net buying position of Rs 126.22 million representing a 43.47% increase from last week’s net buying position of Rs 87.98 million.

Foreign purchases for the week saw a considerable gain, amounting to Rs 2,004.63 million compared to last week’s Rs 362.17 million.

Galadari Hotels topped the volume list accounting for 10.46% (or 33.07 million shares) of the week’s aggregate share volume; Panasian Power Plc meawhile, contributed 7.13% of the total share volume as 22.56 million of its shares changed hands over the week.

Point of view

Markets lacked direction over the week with Indices see-sawing amidst media speculation over regulatory body changes. Turnover continued to dwindle, closing the week at its lowest level since December 2010. We expect similar sentiments to prevail in the week ahead as investors adopt a reactionary attitude. Corporate earnings however, defy the current negative market sentiment and continue to be buoyant. While a large proportion of the companies have recorded net profit gains over the quarter, 57% of the 58 companies that have released earnings thus far have recorded year-on-year growth.