Retail investors show interest; foreigners net sellers
Stocks rose 1.82 percent to a three-week high yesterday after the central bank surprised the market with a 25 basis point rate cut followed by a reduction in yields on government securities.
The main All Share Price Index rose 1.8 percent gaining 98.86 points while Milanka and S&P Lanka20 gained 97.77 and 31.4 points respectively. The market turnover stood at Rs.480 million.
According to Lanka Securities, retail investors showed interest across the board with 225 stocks posting gains out of the 238 traded.
Interestingly foreigners were net sellers today, ending two consecutive days of net buying. Foreign participation accounted for 28% of the total turnover with a net outflow over Rs.36 billion.
The highest contribution for the turnover came from HNB (LKR 88.1mn), Nestle (LKR 49.6mn) and John Keells Holdings (LKR 44.6mn). The three crossings reported in HNB and Nestle accounted for only 18% of the total turnover. The cash map (exl crossings) advanced to 58% reflecting the upbeat momentum of the local investors.
Central Investments and Finance Co (+16%), Stafford Hotels (+13.5%), HVA foods (+10%) and Laugfs Gas-nonvoting (+8%) were among the top performers while heavy interest was seen in Peoples Leasing, Nation Lanka Finance and SMB Leasing-non-voting.
“There should be a market improvement. But sustaining the buying momentum will depend on how soon retail investors will switch to stocks from fixed income,” a broker was quoted as saying by Reuters.
The rupee closed slightly firmer at 128.65/70 to the dollar compared with Tuesday’s close of 128.80/90 on exporter dollar conversion in light trade, dealers said.