Colombo Stock Exchange Market Review – 16th Dec 2016

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Colombo Stock Exchange Trade Summary 16-Dec-2016

Colombo equities skidded to two-week low on Friday with sluggish investor participation amid concerns over economic front. ASI closed 16.92 points (0.3%) lower at 6,268.61 while S&P SL 20 index closed 7.94 points (0.3%) down at 3,521.67.

Premier blue-chips such as John Keells Holdings (LKR 147.10,-1.1%), LOLC (LKR 74.50,-4.5%) and Sri Lanka Telecom (LKR 33.60,-2.6%) led the losers in today’s session. Out of the 186 scripts traded today only 41 managed to increase in price while 64 closed with negative returns. Among the gainers were Hemas Holdings (LKR 100.00, +2%) and Lanka Hospitals (LKR 68.30,+2.9%)

Despite the weak sentiments in the broader market, institutional investor activity in Seylan Bank pushed the turnover to LKR 1.9bn. Foreign investors bought 13.2mn shares of Seylan Bank at LKR 100.00 in a single crossing and the trade accounted for 70% of the turnover. Further crossings were seen in Chevron Lubricants (1mn shares at LKR 161.00) and Commercial Bank (0.7mn shares at LKR 145.00) and the three negotiated deals accounted for 85% of the market activity. Accordingly, Seylan Bank (LKR 1.3bn) emerged as the top contributor to the turnover along with Commercial Bank (LKR 179mn) and Chevron Lubricants (LKR 176mn). 

Activity in the normal board was dominated by Sanasa Development Bank which saw its share price rising 6% to LKR 105.00 following the announcement of proposed LKR 3.3bn fund raising. As per the announcement, LKR 1.5bn will be raised by an issue of 10.4mn shares (at LKR 140.00) to FMO, SBI-FMO and IFC via a private placement while the balance will be raised through subordinated convertible term loans placed with the same investors.

Apart from Sanasa Development Bank, shares of Chevron Lubricants, John Keells Holdings and Pan Asia Bank saw relatively high level of trading.

Foreign investors were net buyers in today’s session with net inflow of LKR 1.4bn. Foreign participation was 57%. Top net inflows were seen in Seylan Bank (LKR 1.3bn), Hemas Holdings (LKR 24mn) and DFCC Bank (LKR 7mn) while top net outflow was seen in Chevron Lubricants (LKR 14mn).
Source: LSL

Sri Lankan shares hit more than 2-wk closing low led by banks

Reuters: Sri Lankan shares fell for a third straight session on Friday to close at their lowest in more than two weeks, as a dollar rally to a 14-year peak after an interest rate increase by the U.S. Federal Reserve earlier this week kept investors subdued.

The 25-basis-point rate increase could hike borrowing costs of foreign capital for Sri Lanka and force the coalition government to borrow locally at higher interest rates, which could also result in movement of money from equities, analysts said.

The Fed also signalled a faster pace of increases in 2017, partly as a result of changes anticipated under a Donald Trump presidency, with the U.S. central bank hinting at three rate hikes next year instead of the two foreseen as of September.

The Colombo stock index ended 0.27 percent weaker at 6,268.61, its lowest close since Nov. 30. The bourse fell 0.88 percent for the week, its second weekly fall.

A block deal in Seylan Bank Plc boosted turnover, with dealers saying state-owned Bank of Ceylon sold 13 million shares to a foreign investor.

"A sizeable crossing of Seylan Bank boosted the turnover. Other than the Seylan trade, there was nothing. The market is getting slower by the day with the holiday mood," said Dimantha Mathew, head of research, First Capital Equities (Pvt) Ltd.

Shares of Seylan Bank Plc ended steady, while Lanka ORIX Leasing Company Plc fell 4.49 percent and conglomerate John Keells Holdings Plc lost 1.14 percent.

Sri Lanka Telecom Plc dropped 2.61 percent, while Commercial Leasing and Finance Plc fell 5.88 percent.

Turnover stood at 1.86 billion rupees ($12.51 million), well above this year's daily average of 753.4 million rupees.

Foreign investors bought a net 1.35 billion rupees worth of shares on Friday, extending the year-to-date net foreign inflow to 1.87 billion rupees worth of equities.

($1 = 148.6500 Sri Lankan rupees) 

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)