Oct 13, 2010 (LBO) - Sri Lanka stocks closed up 1.4 percent after a wild ride Wednesday with the benchmark index falling 5.7 percent in intra-day trade until institutional buying returned to support prices, brokers said.
The benchmark All Share Price Index closed up 94.81 points at 6,628.83 points recovering a part of the 4.4 percent loss a day earlier.
The Milanka Index of liquid stocks closed up 0.56 percent (47.13) at 7,166.88. The Colombo stock exchange halted trading for half an hour till 10.59 am after the index fell more than 5.0 percent after one hour of trading as jittery investors dumped stocks.
The intra-day fall of 5.7 percent is the highest since January 27, 2005, when stocks fell 6.97 percent according to Bloomberg newswires data.
Sri Lanka stock market watchdog put limits on margin trading and also price curbs after Colombo Stocks including to prevent the formation of large bubble which can collapse and hurt the broader economy.
Many Sri Lankan stocks are illiquid making them easy to manipulate. The overall market was valued at 25.1 times historical earnings at the day's close.
Sri Lanka's stocks were up more than 110 percent at the beginning of the month, and with stocks with weak fundamentals also zooming up fears of overheating has emerged.
Among the stocks that saw buying support Wednesday was John Keells Holdings which closed up 6.70 at 320.30 after falling as low as 300.00 with 3.0 million shares traded.
Dialog Axiata, another index heavy stock fell to 11.00 rupees before closing flat at 12.00.
Hatton National Bank closed up 4.40 rupees at 220.60 after falling as low as 200.00 rupees, National Development Bank closed up 4.70 at 360.20 after falling as low as 336.00.
Nestle Lanka closed up 16.10 at 665.00 after falling as low as 630.00.
Aitken Spence Hotel Holdings closed up 11.40 at 778.00 after falling to 680.00.
source - www.lbo.lk
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