All three indices decline
The four day trading week experienced a decline across all three
indices, with the ASPI declining 37.13 points (0.75%), the MPI declining
23.52 points (0.54%) and the S&P SL 20 Index losing 20.84 points
(0.74%). The ASPI closed at 4928.64 points while the MPI and S&P SL 20
Index closed at 4359.68 and 2796.51 points, respectively.
The daily average turnover value declined significantly (87.38%) over
the week to LKR 292.61mn from last week’s daily average turnover of LKR
2.32bn. JKH was the highest contributor to total turnover, accounting
for 10.38% or LKR 121.50mn of the market’s total turnover value. Amongst
the other top contributors were Commercial Bank [NV] contributing 8.37%
and Dialog accounting for 7.34% of the total market turnover. Market
Capitalization declined 0.58% or LKR 10.95bn over the week to close at
1883.27bn compared to last week’s close of LKR 1894.22bn.
Sector wise, the Banking and Finance sector - mainly aided by
Commercial Bank [NV] - was the highest contributor to the weekly
turnover value, accounting for 27.40% or LKR 320.73mn of market
turnover. The Diversified sector followed suit accounting for 25.38%.
The Manufacturing sector meanwhile added 10.88% to total market turnover
value.
In terms of volume, the Banking and Finance sector accounted for
24.13% of turnover volume with 17.08mn shares being traded over the
week. The Telecom sector contributed 19.59% (or 3.86mn shares) while the
Diversified sector accounted for 11.81mn shares (or 16.68%) of total
turnover volume.
The highest price gainers for the week was led by J.L. Morison which
gained 16.99% to close at LKR 179.00 compared to its previous week close
of LKR 153.00. Durdans [NV] gained 12.89% to close at LKR 62.20 while
Agstar Fertilizers closed at LKR 8.90 up 12.66% from last week. Sigiriya
Village and Ceylon Beverages also featured amongst the week’s top
gainers, increasing 10.6% and 10.0% respectively.
Entrust Securities was the highest price loser for the week, closing
at LKR 13.30 down 27.72% from last week’s close of LKR 18.40. Autodrome
declined 24.68% to close at LKR 582.20, while Tangerine dropped 20.56%
to close the week at LKR 70.70.
Foreign participation recorded a net buying position yet again this
week, recording LKR 359.67mn or an average of LKR 89.92bn relative to
last week’s daily average of LKR 88.84mn. Daily average foreign
purchases declined 13.17% from last week’s value of LKR 177.43mn to LKR
154.07mn, while daily average foreign sales amounted to LKR 64.15mn,
down 27.59% from last week. Commercial Bank and Central Finance led
foreign purchases in terms of volume, while Dialog Axiata and People’s
Leasing led the foreign sales. In terms of value, Commercial Bank and
Nestle led foreign purchases, while Carsons and Dialog led foreign
sales. purchases, while Carsons Cumberbatch and JKH led foreign sales.
Point of View
Markets continued to lose steam this week with turnover hitting a new
low (LKR 90.0Mn) since April 2009 (LKR 80.9Mn). Although turnover levels
recovered back to LKR 0.3bn levels over the remainder of the week,
markets remained muted with little activity. Market activity was driven
mainly by strategic transfers by corporates and high net-worth investors
with retail activity yet to pick up pace. Similar sluggish sentiment is
likely prevail to in the week ahead.
The mid-year fiscal position indicates a widened budget deficit for
Jan-Apr 2012, with the deficit at 3.8% of GDP relative to 2.7% a year
ago.
The Ministry of Finance added that despite the current revenue lags
and expenditure leads, the year-end deficit target of 6.2% of GDP
remains feasible. The LKR meanwhile appreciated against most major
currencies, gaining over 2.0% against the Euro and 0.06% against the USD.
Y-T-D foreign inflows to the CSE meanwhile remain strong, with net
inflows at LKR 23.21bn for Jan-Jun relative to a net outflow of LKR
7.41bn last year.
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