As predicted in our previous stock market review, the bull surge did arrive with the result that the Colombo Stock Exchange witnessed an impressive second straight week of buying; with the ASPI closing at a 20 week high of 5496 points on Friday, edging somewhat closer to the 5500 mark considered by many as a physiological barrier. The Milanka too broke the 5000 barrier to close at 5093 thus rising back to the 5000 levels recorded at the beginning of the year. Owing to the euphoria, seen during the first week in September, the market recorded a gain of 316 points or 6% on the ASPI and 281 points or a near 6% gain on the Milanka.
The mood in the market remained very positive especially among retail investors running to acquire a stake in low priced well managed profitable mid cap stocks offering good value such as Central Industries at Rs.79.50, Lanka Aluminium at Rs.33.70, Piramal Glass at Rs.6.20, Richard Pieris at Rs.8.80, Dankotuwa Porcelain at Rs.16.90, CDB at Rs.44.50, Keells Hotels at Rs.14.20, Access at Rs.17.40, Colombo Fort Land at Rs.38.90 and Dolphin Hotels at Rs.36.00.
With the resumption of trading for the week on Monday the ASPI and the Milanka gained 70 and 90 points respectively; ASPI closed at 5250 and Milanka closed at 4904 while the turnover stood at Rs.981 million. Stocks changing hands in large volumes included E–Channeling, JKH, GREG, Commercial Bank and Ceylinco Seylan Development. Among top gainers, SMB Leasing (non-voting) gained 33.33% while Pegasus Hotels, Blue Diamonds and LOLC gained 16%, 13% and 12% respectively.
With the market continuing its upward momentum on Tuesday resulted in the ASPI and Milanka closing at 5327 and 4978 respectively and turnover levels were boosted to record a figure of Rs.1.24 billion. Among stocks heavily traded, FLCH led recording high volumes with approximately 28 million shares being traded closing at Rs.3.00. Other highly traded shares were Sampath Bank, E– Channeling, Peoples Leasing and Bukit Darah.
On Wednesday, the ASPI continued bull run by moving up 45 points to close at 5372 while the Milanka changed its direction and came down marginally by 8 points to close at 4971 partially attributed to a net foreign outflow of Rs.28m recorded, and the turnover registered during the day was Rs.941 million. A quantity of 27.5 million shares of FLCH traded during the day closing at Rs.3 while Dialog and Peoples Leasing fetched Rs.6.10 and Rs.13.30 respectively, while Tess Agro and Panasian Power fetched Rs.3.30 and Rs.3.00 respectively. SMB leasing non-voting gained 25% during the day to close at Rs.0.50 while its voting share also gained 18% to close at Rs.1.30.
The market rose with the ASPI and the Milanka achieving 17 and 25 points to close at 5389 and 4995 respectively. The market took a slight dip as profit taking by retail investors came intermittently realizing gains. However, the market picked up later in the day led by Asiri Medical which saw a quantity of 41.7 million shares changing hands at Rs.8.30. Renewed buying interest emerged among stocks that included JKH at Rs.198.80, EXPO at Rs.7.70, Seylan non-voting Rs.30.00, Sampath Rs.190.00 and Peoples Leasing at Rs.13.00 were other shares which contributed to the turnover reaching Rs.1.09 billion. Commercial Leasing recorded the highest gain during the day moving up as much as 30% to close at Rs.4.80. While Lanka Cement transacted at Rs.12.90, Central Investments at Rs.5.20 and Lanka Orix at Rs.4.40 yielded favorable returns for stock market investors ranging from 10% to 29%.
On the final day of the week, the market flexed its muscles resulting in both increased turnover of Rs. 1.76 billion and a gain of 108 and 98 points on the ASPI and Milanka respectively. Stocks emerging as winners were Sampath Bank at Rs.196.00 and JKH at Rs.200.00. With the number of stocks advancing far outnumbering those declining most of the week, we are of the view that the market is signaling a very strong buying sentiment and we expect good gains to pour in next week too.
(Courtesy: Innovest Investments (Pvt) Ltd – an Investment Management Company licensed by the Securities & Exchange Commission of Sri Lanka)