Heavy retail activity crowed the market with increased retail interest in speculative counters. Institutional play and value investors seemed to be on the side-lines as the speculative lot topped the turnover list. However, interest in blue chip counters were still prevalent though on low volumes as John Keells Holdings, Finlays Colombo, Distilleries and Chevron Lubricants ended as the top positive contributors for the index.
The positive contributors outnumbered the negative contributors today 2:1. The more liquid Milanka gained 40 points to outperform the benchmark index which only gained 19 points. We expect some selling pressure to return to the market with the index gaining for 7 consecutive days. We believe investors should buy into the selling pressure in search of counters at bargain prices.
Retail favourite speculative counter HVA Foods was the top performer with volumes of 5.7 mn shares changing. The counter gained as much as 9.3% to close the day at LKR14.0. The counter recorded an intra-day high of LKR14.5 while the intra-day low was LKR13.2. More speculative counters PC House and Citrus Leisure dragged investor interest amidst relatively large volumes. These counters which saw their values crashing in the downturn witnessed a lot of resistance and selling pressure during the last couple of days. Both the counters gained in value with the former recording a price gain of 4.3% to close at LKR7.3 while the latter gained 3.3% to close at LKR34.0.
The recently introduced Ramboda Falls managed creep into the top performer list with 488k shares changing hands. The counter witnessed steep drop in its price to close at LKR29.5 (-10.0%). Another speculative counter Nations Lanka Finance registered a 12.2% appreciation in value with 1.9 mn shares trading.
Cargills was the only fundamentally sound counter to enter the top turnover list recording the second place supported by 5 blocks ranging from 50k-150k being dealt on board. The blocks were traded 5.0% below the previous closing price at LKR150.0 and closed at the same price as well.
European Stocks Little Changed: Europeans stocks were little changed, halting a three-day rally, as investors awaited the outcome of the Federal Reserve’s monetary-policy meeting. U.S. futures were little changed, while Asian shares climbed. The Stoxx Europe 600 Index lost less than 0.1% to 248.25 at 9:45 a.m. in London.
Oil Drops A Third Day: Brent oil dropped for a third day in London on speculation that U.S. supplies may have shrunk less than estimated, while investors awaited the outcome of a Federal Reserve monetary policy meeting. Brent crude for August settlement was at USD94.91 a barrel, down 85 cents, on the London-based ICE Futures Europe exchange at 9:02 a.m. local time.