Market Heads Further Down…. 09th March 2011

Top traded counters were John Keells Holdings LKR651.9 mn (USD5,913.5 k, -2.5%), Royal Ceramics LKR239.6 mn (USD2,173.4 k, -1.6%), Ceylinco Insurance LKR105.5 mn (USD957.0 k, +6.4%), Lankem Developments LKR92.7 mn (USD840.9 k, +3.9%) and Laugfs LKR55.2 mn (USD500.7 k, -3.1%).
 

Today’s market dip was driven by retail selling pressure, cashing out of  foreign portfolio investments following near 100% capital gains over the past 12-Month period and also the directors of premier blue chip John Keells Holdings (JKH) exercising their options and cashing out. The retail selling is a resultant of the need to raise capital for the forthcoming IPO’s, monies still locked up with the previously concluded IPO of Union Bank and also the 31st March 2011 deadline given to the brokering houses to clear 50% of the debt outstanding  as at end 2010.  
 

The heavy weight John Keells Holdings saw institutional and high net worth interest during the day where it contributed for circa 28% of day’s turnover. Royal Ceramics and Ceylinco Insurance continued to attract institutional investors together with Laugfs Gas whilst Lankem Development witnessed renewed all round interest following the announcement of the possible acquisition of +61% stake in Agarapathana Plantations, which is to be financed via a rights issue.
 

A net outflow of foreign funds were seen during the day, where foreign purchases amounted to LKR134.3 mn (USD1218.2 k), whilst foreign sales amounted to LKR319.5 mn (USD2,897.8 k).



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