The bourse closed the week on a positive note, as the ASPI increased 107.09 points W-o-W (or -1.50%) to close at 7269.05 points, while the S&P SL20 Index increased 1.44% W-o-W (or 57.90 points) to close at 4071.65 points.
Turnover & market capitalization
John Keells Holdings was the highest contributor to the week’s turnover value with a contribution of LKR 930.56mn that accounted for 14.47% of total turnover value. Asiri Hospital Holdings followed suit accounting for 12.67% of turnover (value of LKR 815.32mn) while Commercial Bank contributed LKR 747.90mn to account for 11.63% of the week’s turnover.
Total turnover value for the week amounted to LKR 6.43bn relative to last week’s value of LKR 5.25bn. Daily average turnover value over the week consequently amounted to LKR 1.29bn (+22.55% W-o-W) compared to last week’s average of LKR 1.05bn. Market capitalization meanwhile, increased 1.50% W-o-W (or LKR 45.50bn) to LKR 3,088.54bn relative to last week’s value of LKR 3,043.04bn.
Liquidity (in Value Terms)
The Bank, Finance and Insurance sector was the highest contributor to the week’s total turnover value, accounting for 33.43% (or LKR 2.15bn) of market turnover. Sector turnover was driven primarily by Commercial Bank, Sampath Bank, DFCC Bank, HNB [NV] and Nations Trust Bank which accounted for 62.35% of the sector’s total turnover value.
The second highest sectoral contribution stemmed from the Diversified sector, which contributed 23.44% (or LKR 1.51bn). Sector turnover was driven primarily by John Keells Holdings and Expolanka which accounted for 68.51%.
Manufacturing was also amongst the top sectoral contributors to market turnover, accounting for 13.03% (or LKR 838.48mn) of the week’s total turnover value. Sector turnover was driven primarily by Textured Jersey Lanka which accounted for 19.45%.
Liquidity (in Volume Terms)
The Banking and Finance sector dominated the market in terms of share volume, accounting for 22.85% (or 46.05mn shares) of total volume, with a value contribution of LKR 2.15bn.
The Diversified sector followed suit adding 16.87% to the week’s total turnover volume as 34.01mn shares were exchanged. The sector’s volume accounted for LKR 1.51bn of total market turnover value.
The Manufacturing sector meanwhile, contributed 28.41mn shares (or 14.09%), amounting to LKR 838.48mn.
Week’s top gainers & losers
Watawala Plantations was the week’s highest price gainer, increasing 19.05% W-o-W from LKR 21.00 to LKR 25.00. Dankotuwa Porcelain gained 15.87% W-o-W to close at LKR 14.60 while Singhe Hospitals gained 14.29% W-o-W to close at LKR 2.40. Royal Palms and Tess Agro were also amongst the week’s top price gainers with W-o-W gains of 13.95% & 13.33%, respectively.
Asian Alliance Insurance was the week’s highest price loser as the stock declined 90.06% W-o-W to close at LKR 21.60, relative to LKR 217.20 last week.
Kegalle Plantation closed at LKR 82.90, representing a W-o-W decline of 40.49%, while Durdans Hospital and Selinsing declined 9.49% and 9.09% W-o-W to close at LKR 103.00 & LKR 1500.00, respectively.
Foreign investors closed the week in a net buying position with total net foreign inflows amounting to LKR 0.36bn relative to last week’s net selling position of LKR 1.05bn (+134.59% W-o-W).
Total foreign purchases increased 2.84% W-o-W to LKR 1.77bn from last week’s value of LKR 1.72bn, while total foreign sales amounted to LKR 1.41bn relative to LKR 2.77bn recorded last week (-49.00% W-o-W).
In terms of volume, Asiri Hospital Holdings and DFCC Bank led foreign purchases, while Expolanka and Commercial Bank led foreign sales. In terms of value too Asiri Hospital Holdings and DFCC Bank led foreign purchases while Commercial Bank and HNB [NV] led foreign sales.
Point of view
Political cues continued to dominate markets this week, with markets running up a significant 121 points between Monday and Friday to break the 7200-level. Prospects of political stability post the General Elections and expectations of positive quarterly earnings revived sentiment, helping the Bourse hits its highest since late May.
Positive momentum over July has helped the Index gain +3.1% over the month, and has helped shave some of the Y-T-D losses on the Index. July’s M-o-M return of +3.1% is the 2nd highest monthly return on the ASPI this year (April’s M-o-M gain of +5.3% was the highest) and has helped trim the -11% decline at the start of the year down to -1%.
This week’s turnover levels also rose to a 3-week high as HNIs and Institutions contributed significantly to total turnover (40% of total turnover value).
Foreign activity too rebounded to a net buying position after 2 consecutive months of outflows, as large inflows in to ASIR and DFCC helped net purchases.
Markets in the week ahead are likely to continuing taking the lead from political developments while the start of the June 2015 earnings season should provide additional support.
August policy rates held steady
In a widely expected move, the Central Bank (CB) held policy rates unchanged for the 3rd consecutive month, citing positive macroeconomic conditions.
The Monetary Authority added that inflation levels continue to remain at near-zero levels and is expected to continue in the next few months on account of the downward adjustments in fuel and energy costs.
On the credit front meanwhile, private credit growth rose to its highest absolute value this year, rising by LKR 50Bn over May to record a Y-o-Y growth of 17.6%. External sector conditions however were not as positive, with the country’s trade deficit widening 49.7% Y-o-Y in May as rising import expenditure (17.2% Y-o-Y) and a marginal decline in exports (-0.1% Y-o-Y) impacting the trade account.
The B-o-P deficit between Jan-May 2015 consequently increased to USD 1307.8mn relative to a surplus of USD 1665.1mn in Jan-May 2014. Gross official reserves in May meanwhile declined to an equivalent of 4.2 months of imports or USD 6.8bn (cf. 4.6 months in April), but is estimated to have increased to USD 7.5bn in June 2015 on account of receipts from the international sovereign bond and SLDBs.
Courtesy: Daily News 27 July 2015