Net foreign buying in CSE crossed Rs.15bn

During the week the All Share Price Index (ASPI) declined by 155.63 points to close at 6,307.43 while the S&P SL20 declined 89.57 points to close at 3,550.47. The daily average turnover was Rs.971mn compared to Rs.1.09bn reported during the previous week, and the week ended with foreign buying amounting to Rs.2.53bn whilst foreign selling was only Rs.592mn. On Monday the market remained restrained marked by marginal dip in indices; ASPI and S&P SL20 lost 3.44 and 4.45 points respectively. Total turnover was only of Rs.750mn to which the largest contribution of Rs.288mn was made by United Motors (UML) that included a crossing of 2.4mn shares at Rs.120. Ceylon Tobacco closed up Rs.14.60 at Rs.1,000 posting the second largest turnover for the day. Chevron Lubricants (LLUB) gained Rs.16.90 (5.1%) to close at Rs.345.20 and was amongst the top five in terms of turnover.

Total turnover reached Rs.1.04bn on Tuesday and the indices moved in opposite directions; ASPI dipped 2.02 points and the S&P SL20 gained 10.31 points. Commercial Bank (COMB) posted the day’s largest turnover of Rs.417.5mn with more than 3.3mn shares traded between Rs.122.00 and 125.00, of which 2.98mn shares traded at Rs.125.00 by way of several crossings. JKH posted the day’s second largest turnover of Rs.87mn, though the share closed down Rs.1.80 at Rs.281.70. 300,000 shares of Heycarb traded at Rs.200 by way of a crossing while the shares closed up at Rs.201.50. On Wednesday the single largest turnover of Rs.276mn was reported from LLUB with 739,651 shares traded. LLUB reached an intraday high of Rs.375.00 but the shares closed down Rs.10.20 at 355.70. Total turnover for the day amounted to Rs.818mn to which CTC, Dialog, JKH and COMB made relatively important contributions. Market closed down on a negative note; ASPI and S&P SL20 lost 26.82 and 10.85 points respectively. This decline was mainly due to price weakening in JKH which closed down Rs.2.30 at 279.40, followed by Commercial Leasing Company which closed down 6.8%. Total turnover reached Rs.1.37bn on Thursday with heavy foreign buying interest in the banking sector. 2mn shares of HNB traded at Rs.169.50 by way of a crossing that posted the day’s single largest turnover of Rs.352mn. COMB posted the second largest turnover of Rs.263mn with 2.1mn shares traded, which included crossing of 1.5mn shares at Rs.123.50 and 0.5mn shares at Rs.123.00. JKH closed down Rs.6.20 (2.2%) to close at Rs.273.20, while LLUB dropped Rs.32.00 (9%) to close at Rs.323.70 which led the market to close on a negative note. ASPI declined 50.46 points and the S&P SL20 by 38.71 points.

On Friday the market closed on a negative note with ASPI and S&P SL20 losing 64.95 and 45.87 points respectively. Total turnover for the day was Rs.884mn of which the single largest turnover was reported from Cargills where 1.33mn shares traded by way of crossings at Rs.180.00. Second largest turnover of Rs.120mn came from COMB through a negotiated deal done at Rs.122.00. Approximately 200,000 shares of Carsons traded during the day chipping in Rs.89mn in turnover.

During the week some profit taking was witnessed in selected counters after the market gained 510 points (8.6%) during the month of May. Foreign investors were net buyers with total net foreign buying for 2013 passing Rs.15bn. The monetary board of the central bank expects bank lending rates to ease in the second half of 2013 with reduced bank borrowings by the state. Thus eeconomic conditions are paving the way for a sustainable up move in equity markets. Hence we see the current market consolidation is temporary and is an opportunity for investors to realign their portfolios to fundamentally strong shares with tremendous growth potential.