Market gains, ASPI rises

Markets gained over the week with the ASPI rising 64.35 points W-o-W (or 1.13%) to close the week at 5768.88 points. The S&P SL 20 Index increased 50.27 points and closed the week at 3312.71 points, up 1.54% from last week’s close.

JKH was the highest contributor to the week’s turnover value accounting for 29.01% of total market turnover with a value of LKR 1.02bn. Union Assurance contributed LKR 262.36mn (or 7.44%) to total turnover value while Commercial Bank accounted for 5.48% adding LKR 193.24mn to total market turnover. Weekly turnover value meanwhile amounted to LKR 3.53bn, increasing 16.97% from last week’s value of LKR 3.01bn. Daily average turnover value for the week amounted to LKR 705.14mn, relative to last week’s daily average of LKR 602.85mn. Market Capitalization meanwhile increased 1.15% (or LKR 25.28bn) to LKR 2217.81bn from last week’s value of LKR 2192.53bn.

The Banking and Finance sector dominated turnover value for the week, accounting for 43.98% (or LKR 1.55bn) of total market turnover. The Diversified sector followed suit with a contribution of LKR 1.26bn accounting for 35.66% of total turnover value, driven mainly by JKH. The Land and Property sector was the third highest contributor, adding LKR 110.21mn, to represent 3.13% of total market turnover.

The Banking and Finance sector dominated in terms of share volume too, with 47.91mn shares changing hands, accounting for 35.32% of total market volume. The Diversified sector accounted for 22.60% with 30.66mn shares being traded while the IT sector contributed 12.74% to total turnover volume as 17.28mn shares changed hands over the week.

The highest price gainer for the week was Durdans [NV] with a W-o-W gain of 17.87% to close at LKR 88.40 compared to the last week’s close of LKR 75.00. Bairaha Farms gained 16.25% W-o-W to close at LKR 147.40 while Serendib Engineering Group, previously known as Infrastructure Development, gained 14.81% W-o-W to close at LKR 155.00. Ascot Holdings and Lake House Printers were also amongst the week’s top price gainers with gains of 13.99% and 13.33%, respectively. Swadeshi Industrial Works was the highest price loser this week declining 39.02% W-o-W to close at LKR 5000.30. Kalamazoo recorded a W-o-W price decline of 17.16% to close at LKR 1820.00 while Asiri Surgical closed at LKR 9.60, representing a 14.29% W-o-W decline.

Foreign investors recorded a net buying position of LKR 0.68bn, a 33.88% W-o-W decline from last week’s net buying position of LKR 1.03bn. Daily average net inflows consequently declined to LKR 0.14bn relative to LKR 0.21bn recorded last week.

Total foreign purchases amounted to LKR 1.40bn relative to LKR 1.49bn last week (5.80% W-o-W decline) while total foreign sales increased 56.36% to LKR 0.73bn, from LKR 0.46bn recorded last week.

In terms of volume, East West Properties and JKH led foreign purchases, while Hemas Holdings and Merchant Bank led foreign sales. In terms of value meanwhile, JKH and Sampath Bank led foreign purchases, while Hemas Holdings and National Development Bank led foreign sales.

Foreign activity predominated this week with year-to-date (Y-T-D) net foreign inflows surpassing LKR 4.0bn, driven mainly by the recent buying into Banking & Finance and Diversified sectors.

Heavy foreign interest in the first three weeks of March helped turn around the Y-T-D net outflow position as net foreign flows have amounted to LKR 4.2bn in the 1st three weeks of March relative to LKR 1.1bn in February and an outflow of LKR 1.4bn in January. Turnover value, though paltry, increased over the week to record a daily average of LKR 0.71bn.

Indices meanwhile recorded consecutive daily gains to close at a 5-week high of 5768.88 points, boosted by fresh buying on selected counters. Activity levels however, are likely to remain muted in the upcoming 3-day trading week. Interest rates rose for the 3rd consecutive week, rising 10bps to close the week at 10.25%. Rates which declined 170bps since the Central Banks’ policy rate cut in early December have been edging higher in the past three weeks.

Within a three-week window, rates have risen a cumulative 17bps. Money market liquidity meanwhile hit a two month low, with average overnight liquidity indicating a surplus of LKR 19.1bn relative to LKR 29.1bn last week and a two month average ofLKR 36.7bn.

During the week the LKR depreciated against most major currencies except for Euro where it showed a small gain. At the end of trading on Friday the USD was quoted as Rs 126.80.