Given phenomenal recent rise, no cause for alarm says brokers Bourse down sharply,profit taking evident

The Colombo bourse yesterday saw a sharp decline with both indices dropping substantially – the All Share by 98.63 points (1.39%) and the Milanka by 107.64 points (1.38%) on a turnover of Rs.3.9 billion, down from the previous day’s Rs.12.5 billion.

"There was some profit taking and the market eased off a little," Prashan Fernando of Acuity Stockbrokers said.

Asked whether decline of around 100 points in each of the two indices was a small, he responded: "Given the way the market has been going up in recent days, the fall was relatively not as sharp as it looks."

Interest in HNB manifest on Monday continued with nearly 1.4 million shares traded between Rs.400.10 to Rs.430 with the counter closing Rs.7.30 down at Rs.407 generating the day’s top turnover of Rs.542.4 million.

There was no word on buyers and sellers although market talk was that Browns appeared to be reducing/has reduced its stake and at least one other big shareholder, possibly complying with Central Bank directives capping ownership of banking stock, was selling down.

"There were five crossings of HNB yesterday all at the price of Rs.400," Fernando of Acuity said noting that the larger parcels ranging in size from between 150,000 to 375,000 thousand shares.

Nawaloka which announced that each existing share would be split into two saw a significant 42.8 million shares done between Rs.9.10 and Rs.10 gaining 10 cents to close at Rs.9.30.

Brokers said that the share has been rising in expectation of a share split and that was perhaps why it gained just 10 cents after the share split announcement.

Index heavyJKH contributed to pushing down the indices losing Rs.11.50 to close at Rs.338 on a trading range of Rs.337 to Rs.350 while Hayleys, with over 0.5 million shares done, was down Rs.1.20 to close at Rs.349 on a trading range of Rs.345 to Rs.352.

Nation’s Trust gained on the falling market – up Rs.5.40 to Rs.99.40 on over 1.5 million shares done between Rs.92 and Rs.100.

Brokers said that retailers were particularly active in Nawaloka, Grain Elevators (up Rs.1.50 to Rs.69 on nearly 2.2 million shares) and even on pricey counters like Browns which gained Rs.3.10 to close at Rs.2.70 on over 0.5 million shares.

Among banking stock Sampath edged down Rs.2.20 to Rs.529.90 on over 0.1 million shares, NDB was down Rs.6.60 to Rs.392 on nearly 0.3 million shares, Commercial Bank was down Rs.8.70 to close at Rs.260 on over 0.2 million shares and DFCC, down Rs.8.40 to close at Rs.472 on 0.1 million shares.

source - www.island.lk