Trading Thursday - Reuters Update - Sri Lanka's stx at 2-wk high as SEC head resigns

Sri Lanka stocks end up 0.9-pct
Dec 01, 2011 (LBO) - Sri Lankan stocks closed higher Thursday with turnover pushed up by a bank deal amid news that the chairperson of the regulatory body was quitting just weeks after powerful investors forced out its director general.

The main All Share Price Index rose 0.94 percent (57.27 points) to 6,144.67, while the more liquid Milanka index rose 0.57 percent (30.18 points) to close at 5,303.76, according to provisional stock exchange figures.
Turnover was 4.2 billion rupees.

Nations Trust Bank trades accounted for the day's biggest turnover with the acquisition of a 9.9 percent stake in NTB by DFCC Bank for 1.3 billion rupees, brokers said.

DFCC Bank bought 22,865,356 shares at 57.80 rupees each in three crossings or off-market deals, a source close to the deal said.

NTB closed at 58 rupees, up 2.10 or 3.8 percent.

Market heavyweight John Keells Holdings closed at 169.90, down 10 cents, with over 1.1 million shares traded, including one crossing of 894,266 shares at 170 rupees each.


Debutant Entrust Securities was the day's highest gainer, closing at 70.90 rupees, up 28.30 or 66 percent, having begun trading earlier this week at its refence price of 20 rupees. Over 3.8 million shares were traded.

Swarnamahal Financial Services was the second highest gainer, closing at 95.30 rupees, up 19.30 or 25 percent with 1.3 million shares changing hands. It hit 99 rupees.

The Lanka Hospital Corporation was the most actively traded stock and third highest gainer, closing at 58.30 rupees, up 11.40 or 24 percent, with over 5.2 million shares done.

HVA Foods was also actively traded, closing at 42.70 rupees, up 1.10 with over 3.4 million shares done.

Securities and Exchange Commission chief Indrani Sugathadasa said she has resigned, just weeks after the watchdog's director general Malik Cader was removed by the cabinet of ministers.

They came under pressure from powerful investors after they began a crackdown on widespread microcap fraud and insider dealing on the Colombo bourse.
http://www.lbo.lk/fullstory.php?nid=1389768608

Thu Dec 1, 2011 1:40pm GMT
* SEC head's resignation pushes bourse -brokers
* Market sees resignation as sign of implementing key requests' made to president -brokers
* Foreign investors buy Keells; net outflow at 347.7 million rupees
* Rupee flat for 7th session; Cenbank sold $210 mln to defend rupee since devaluation- dealers

COLOMBO, Dec 1 (Reuters) - Sri Lanka's stock market gained on Thursday with the news the head of the Securities and
Exchange Commission (SEC) had resigned, as investors awaited implementation of broker requests to President Mahinda Rajapaksa to boost a faltering bourse.

The island nation's main share index closed 0.94 or 57.27 points up at 6,144.67 after rising as high as 1.17 percent, highest since Nov. 14.

On Thursday, SEC Chairperson Indrani Sugathadasa stepped down "to uphold her principles," barely a month after her deputy was moved amid broker complaints that tougher regulation was hurting sentiment.

"Her statement that she is resigning to uphold her principles is an indication that at least some broker requests are going to be implemented. So, some took it as a positive sign," a market analyst said on condition of anonymity.

Brokers have complained investor sentiment has turned negative due to firmer regulation by the SEC, which has looked into price manipulation and cut the amount of credit available in the market, which has hit broker commissions and trading volume.
The bourse surged 4.14 percent on Monday from a 14-month low after Rajapaksa met the heads of stock brokerages who urged the president to take action to help the bourse rebound.

"The market stayed on green throughout the day while the speculative counters continued to dominate market activity. The turnover was pushed up by a banking sector deal," NDB stockbrokers said in a note to investors.

Nations Trust Bank PLC, which accounted for a third of the day's turnover, rose 3.76 percent to 58 rupees as DFCC
Bank bought 9.9 percent of NTB for 1.32 billion Sri Lanka rupees.

That boosted the day's turnover to a 3-month high of 4.2 billion rupees ($36.88 million), and well above last year's average of 2.4 billion and this year's 2.4 billion.

Shares in Lanka Hospital Corp. PLC leapt 24.31 percent to 58.30 rupees. Defence Secretary Gotabaya Rajapaksa, the president's younger brother, sits on its board.

Market heavyweight John Keells Holdings PLC, which saw foreign buying of 42,200 shares, ended almost flat at 169.90 rupees.

Total volume was 116.9 million shares, highest since Nov.2, against a five-day average of 95.2 million. The 30-day and 90-day average trading volumes were 60.8 million and 102.3 million. Last year's daily average was 67.9 million.

The bourse has fallen 9.42 percent since Oct. 1. It fell to Asia's 11th-best performer with a year-to-date loss of 7.40 percent on gains of global markets. It gave Asia's best returns in 2009 and 2010.

The bourse saw a net foreign outflow of 347.7 million rupees on Thursday, and thus far in 2011, offshore investors have sold 17.7 billion, and a record 26.4 billion in 2010.

On Thursday, the bourse was in neutral territory with the 14-day relative strength index at 47.1, above the lower neutral range of 30. Gainers outnumbered losers by 173 to 39 on Thursday, Thomson Reuters data showed.

The rupee closed flat at 113.89/90 rupees a dollar for the seventh straight session, dealers said.

The central bank on Thursday sold around $10 million to defend the currency, dealers said, extending its total dollar sales to $210 million since 3 percent devaluation on Nov. 22.


FACTORS TO WATCH:
- Investors' moods after the devaluation
- The potential for imported inflation post-devaluation
- The reserve cost of defending the new rupee rate

DATA
Colombo Stock Exchange:
Stock Market Volume (Shares)
Current Volume-----------Average Volume 30 Days
116,884,250----------------------------60,808,588

Yield and Price of Sri Lanka's sovereign bonds:
Maturing year----Tenure------Amount-----------Reuters yield
2012-------------5-yr--------$500 mln----------6.404-6.113
2014-------------5-yr--------$500 mln----------5.461-5.123
2020------------10-yr--------$1,000 mln--------6.3231-6.171
2021------------10-yr--------$1,000 mln--------6.4609 -6.3196

($1 = 113.8950 Sri Lanka rupees)
(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Bryson Hull)
http://uk.reuters.com/article/2011/12/01/markets-srilanka-idUKL4E7N121A20111201