Both the ASPI and the MPI closed the week on a positive note, reversing the marginal losses experienced early in the week. The ASPI recorded a 0.73% gain while the more liquid MPI gained by 0.35% week-on-week, the ASPI closed at 6783.55 points and the MPI closed at 6045.11 points.

Turnover value for the week was dominated by Ascot Holdings, Regnis and Asian Alliance Insurance, which accounted for 21.42% of the total turnover value for the week. The weekly turnover value increased by 38.89% to Rs 9.50 billion, amounting to a daily average of Rs 1.90 billion, as against last week’s average value of Rs 1.71 billion. The number of shares traded decreased 14.0% to average 84.88 million over the week as against last week’s average of 98.74 million.

The Manufacturing sector led the turnover value for the week, accounting for 19.45% amounting to Rs 1.85 billion, followed by the Banking and Finance sector, amounting to Rs 1.68 billion or 17.66%. The third highest contributor was the Investment Trust sector accounting for 11.94% or Rs 1.13 billion. The Manufacturing sector also dominated Turnover volume for the week, accounting for 25.93% with 110.04 million shares being traded. The second highest contributor to volume was the Banking and Finance sector, with 85.62 million shares changing hands (20.17% of total turnover volume). This was followed by the Trading sector which accounted for 15.10% or 64.08 million shares being traded. Market Capitalization increased marginally by 0.7% to close at Rs 2435.50 billion, as against last week’s close of Rs 2417.92 billion. Asian Alliance Insurance remained the highest price gainer, gaining 77.92% to close at Rs 358.50, relative to last week’s close of Rs 201.50. Singer Industries followed, gaining 52.97% to close at Rs 384.10, while the third highest gainer for the week was Industrial Asphalts which closed at Rs 786.90 to represent a week-on-week gain of 52.77%.

The week’s major price loser was Alufab Plc which declined 19.78% to close at Rs 58.4 compared to last week’s close of Rs 72.8. Sathosa Motors also topped the major losers’ list, decreasing 14.36% to close at Rs 340. The third major price loser for the week was Tangerine Beach Hotels Plc, declining 12.93% to close at Rs 86.2. Gestetner and Horana Plantations were also among the price losers for the week, declining 12.49% and 10.51% respectively. The close of the week witnessed a considerable 41.35% decline in foreign outflow with average sales amounting to Rs 159.16 million relative to last week’s average sales of Rs 271.35 million. Average foreign purchases for the week amounted to Rs 78.71 million, representing a 25.03% decline. Blue Diamonds (NV) topped the volume list accounting for 14.76% (or 62.66 million shares) of the week’s aggregate share volume. Tess Agro contributed 14.18% of the total share volume as 60.17 million shares changed hands over the week.

The country’s macro-economic picture continues to brighten, with the latest data on the balance-of-payments (B-o-P) and external trade indicating positive momentum. B-o-P components Foreign Direct Inflows rose 98.6% Y-o-Y (from H1 2010) while foreign inflows to the government (including proceeds from the recently issued 10-year Sovereign Bond) rose 72.4% Y-o-Y y-t-d helping offset a wider trade deficit. The positive sentiment stemming from the recent spate of encouraging macro-economic indicators and estimates should filter down to financial markets in the months ahead. Fundamentally sound corporates are more likely to benefit from this encouraging macro-scenario. We thus advise investors to accumulate a portfolio of fundamentally sound stocks over illiquid stocks that have dominated markets thus far.

Acuity Stockbrokers
source - www.dailynews.lk