Wednesday, February 22, 2012

Bourse solid though on thin volume

The Colombo stock market closed yesterday on a solid note after opening from a bullish state late last week.

 The All Share Index improved by 0.4% whilst the Milanka Index fared better by gaining 1%. Turnover was a healthy Rs. 1.1 billion though volume of shares traded remained relatively low at 39 million as against 95 million on Friday.

 NDB Stockbrokers said the market continued to improve with widespread buying across the board, indicating signs of consolidation.

Both indices improved, mainly as a result of index heavy John Keells Holdings going up by 2.15%. Retail interest was witnessed in Commercial Bank while institutional interest occurred in Lion Brewery. PC House, Environmental Resources, ACME and Swarnamahal Finance attracted interest as well.

 Beverage Food and Tobacco sector was the highest contributor to the market turnover (due to Lion Brewery) and the sector index gained 0.82%. The share price of Lion Brewery gained Rs. 14.10 (7.58%) to close at Rs. 200.

 John Keells Holdings was the second highest contributor to the market turnover. The share price improved by Rs. 3.50 (2.15%), to close at Rs. 166.50. The Manufacturing sector also contributed to the market turnover (due to Royal Ceramics) and the sector index decreased by 0.02%. The share price of Royal Ceramics gained by Rs. 2 (1.69%), to close at Rs. 122. Reuters said the index was in neutral territory on Tuesday with the 14-day Relative Strength Index at 38.033, above the lower neutral range of 30, Reuters data showed. It is the worst performer among Asian markets with a 13 per cent loss so far this year.

 Foreign investors were net buyers of Rs. 75.1 million on Tuesday, extending the net foreign inflow to Rs. 1.84 billion worth of shares so far this year, after net outflows of 19.1 billion last year. Arrenga Capital said market remained in the green throughout the day’s trading, despite seeing some volatility.

“Accumulation in fundamentally sound stocks, albeit on thin volumes, led most of them to advance as the liquid MPI outperformed the benchmark index,” it said, adding that gains were registered in index-heavy John Keells Holdings, Distilleries and Vallibel One.

 Arrenga said Vallibel One along with its related companies, Royal Ceramics and LB Finance attracted substantial interest. Its manufacturing subsidiary Royal Ceramics appeared among the top five turnover list after some lapse, as the counter saw considerable buying interest. The emerging conglomerate’s finance sector arm, LB Finance, was also actively traded as it touched a high of Rs. 146 (up 7.6%). The counter closed at Rs. 19 (+6.2%), Rs. 120 (+1.7%) and Rs. 141.4 (+4.2%) respectively.

 Renewed participation was evident in Asiri Surgical Hospital, as the Health sector player witnessed a block of five million shares being crossed off at Rs. 8 per share (6.7% premium to the previous closing). The counter closed at Rs. 7.9 gaining by 5.3%.

 Interest also prevailed in Tokyo cement, Commercial Bank [Voting and Non-Voting], Dialog Axiata and Hatton National Bank [Non-Voting]. Speculative chase continued in Environmental Resources Investments, Acme Printing & Packaging, Swarnamahal Financial Services and HVA Foods.

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