Monday, March 28, 2011

Retail run continues momentum

The week saw both indices moving up marginally, with the ASPI gaining 0.7 percent or 55.33 points and the MPI gaining 2.19 percent, a gain of 146.42 points.

The MPI closed at 6838.02. The weekly turnover saw a substantial increase in value at Rs 14.35 billion, from that of the previous week of Rs 7.13 billion, a growth of 101.34 percent. Turnover in volume grew by 15.33 percent as 323.9 million shares were transacted as against last week’s 280.8 million.

The Banking and Finance sector contributed over 45.6 percent of the weeks turnover driven by Central Finance, Ceylinco Insurance, LB Finance, and Vallibel Finance, followed by Manufacturing which accounted for 17 percent dominated by interest in Royal Ceramics.

The other major contributors to the week’s turnover were Investment Trusts and the Diversified sector.

In terms of turnover volumes, Manufacturing sector led the way accounting for more than 32.8 percent of total volumes with trades in Sierra Cables, Piramal and Blue Diamonds, followed closely by the Banking and Finance sector with 32 percent of the trading volumes as investor interest in SMB Leasing, Amana and Vallibel Finance drive sector volumes.

Central Finance dominated the market with a turnover of Rs 2.44 billion representing 17.06 percent of total market turnover. Ceylinco Insurance recorded a turnover of Rs 1.93 billion, accounting for 13.44 percent of total market turnover.

Pelwatte Sugar contributed 9.63 percent of market turnover recording Rs 1.38 billion followed by strategic investment in the share. L B Finance, Guardian Capital and Distilleries turnover amounted to Rs 714.05 million, Rs 627.65 million and Rs 571.19 million respectively.

Cold Stores was this week’s Top Price Gainer with the share increasing from Rs 600 to close at Rs 799, a 33 percent increase. Next on the list was Tea Smallholders with a price gain of Rs 32 percent as the share grew from Rs 170 to Rs 225. LB Finance which closed at Rs 178.60 also saw a 31 percent price hike.

Guardian Capital was the major loser during the week with a decline in the share price of 76 percent to close at Rs 294.2 from Rs 1200 at the start of the week. Amana lost 30 percent to close at Rs 2.30 whilst Huejay, Industrial Asphalts and Convenience Foods were amongst other losers for the week.

Foreign investors returned to net sellers this week with total sales of Rs 2.51 billion representing a growth in selling interest by over 193 percent while purchases at Rs 498 million saw a growth of 81 percent. The increase in net selling was 205 percent, as net sellers recorded Rs 2.01 billion.

Pelwatte Sugar toped in the volume chart with 45.81 million shares changing hands denoting 14.14 percent of market volume. Sierra Cables accounted for 11.87 percent of market volume with the share closing at Rs 5.90. Pan Asian Power, S M B Leasing and Richard Pieris recorded share volumes of 35.33 million, 17.80 million and 14.57 million respectively.
Point of view

The Colombo bourse remained stable during this week’s trading with both indices gaining ground compared to the downturn witnessed the previous week.

Retail investors continued to be active in the market while a few strategic investments also boosted activity levels.

We expect the current retail drive to continue into the week ahead.

Union Bank debuts in the secondary market on Tuesday and with the IPO being oversubscribed around 350 times is expected to attract investor interest.

Sound earnings reported by key growth sectors such as Plantations, Food and Beverage, Manufacturing have reiterated values for selected counters at current price levels which may renew buying interest among investors.

source - www.dailynews.lk

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