Bourse nosedives despite fair valuations

21 November 2012 02:47 am - 0 - {{hitsCtrl.values.hits}}

A A A

The indices of Colombo Stock Exchange (CSE) continued its downward flight for the fifth straight day amidst lack of buying interest on the board, both local and foreign, despite most of the shares now trading below t heir intrinsic values, according to stock market analysts and brokers.

The main All Share Price Index (ASI) yesterday breached the 5, 500 psychological level and closed 5434, losing 67 points, down by 1.27 percent. The more liquid Milanka Price Index (MPI) which sank below 5,000 point level however recovered to 5, 004, though losing 82 points, down by 1.61 percent. The newly introduced S&P SL20 Index fell 0.48 percent or 14 points to close at 2, 992. The turnover struggled amidst lack of large deals to Rs.272 million, well below the daily average turnover of Rs.910 million.

According to Lanka Securities, selling activity was evident by retail investors yesterday as people were preparing for the upcoming holiday season. However some analysts contradicted this statement saying that it’s too early for the market to lose steam for the December holiday season. “Markets extended its yesterday’s fall and have now broken below its crucial support level of 5,500. Technically the markets are looking weak and after the break of 5,500 it has opened way for further downside. On the downside the markets can test 5,300 levels and below this the next support zone comes around 5,200,” Bartleet Religare Securities said.

According to Softlogic Equity Research, the poor performance of I n d e x h e av y Dialog Axiata (-4.8%),Commercial Leas ing & Finance (-7.7%), John Keells Holdings (-0.9%) and Cargills (Ceylon) (-3.4%) predominantly weighed on the index negatively.

Quoting stock analysts and brokers, Reuters said that investors had been shifting to fixed deposits from equities after the Central Bank kept key policy rates at three-year high after the market closed on Friday.

“High interest rates and uncertainty on where the interest rates are heading are keeping the local investors away,” one broker was quoted as saying.

Foreign investors bought a net 75.5 million rupees worth of shares, extending the net foreign inflow this year to 34 billion rupees.

Order Gifts and Flowers to Sri Lanka. See Kapruka's top selling online shopping categories such as Toys, Grocery, Kids Toys, Birthday Cakes, Fruits, Chocolates, Clothing and Electronics. Also see Kapruka's unique online services such as Money Remittence,Astrology, Courier/Delivery, Medicine Delivery and over 700 top brands. Also get products from Amazon & Ebay via Kapruka Gloabal Shop into Sri Lanka

Comments - 0

Add comment
Comments will be edited (grammar, spelling and slang) and authorized at the discretion of Daily Mirror online. The website also has the right not to publish selected comments.

Bourse nosedives despite fair valuations

Comments - 0

Add comment

RECOMMENDED

‘Spike in blast fishing’ poses renewed threats to Sri Lanka’s marine ecosystems

UDA owned land in Thalawathugoda; UDA Minister Prasanna Ranatunga under the spotlight for forceful occupation of reserved land

Loss-making SMIB faces political pressure in recovering loans

Baltimore Bridge Collapse: MV Dali, SL authorities anchored in mystery?

Has Sri Lanka become a potential hub for the illegal wildlife trade?

Spotlight on Moragahakanda Development Project Moragolla villagers lose livelihoods and down to one meal a day

Ambitious Sri Lankan jobseekers ‘trafficked into Ukraine war zones’

Most Viewed in News

SL on alert on possible genocide allegations by Canada

Street food vendor arrested for verbally harassing foreigner

Ranil Wickremesinghe caravan moves on despite barking dogs

Former MP Palitha Thewarapperuma dies from electrocution

New Visa procedure implemented

Two racing drivers arrested over Fox Hill tragedy

MIRROR CRICKET

Is Chamari Athapaththu Sri Lanka’s greatest cricketer ever?

Athapaththu back atop ICC Women’s ODI Batting Rankings

Chamari Athapaththu sets big goal for T20 World Cup

How does CSK get best out of Pathirana?

TODAY'S HEADLINES

No footboard riding allowed, no liability for accidents: Railways Department

Six patients claim Rs.600 million from Keheliya and others for permanent loss of sight

SLPP, UNP initiates action for forming broad alliance

Here is the way!

Pakistan lose key players for last two T20Is against New Zealand

Sri Lanka secures third spot in South Asian Kurash Championship 2024

Athapaththu back atop ICC Women’s ODI Batting Rankings

Army forms committee to probe Diyatalawa Fox Hill Supercross accident