Selling at JKH; EPF suspected

It was in the grapevine yesterday that the state-controlled private sector pension fund, the Employees’ Provident Fund (EPF), had been selling top blue-chip John Keells Holdings PLC (JKH) shares, dragging the share price as well as the entire market down. 

According to Lanka Securities, the JKH share yesterday slipped to a one-year low of Rs.150.10 before closing at Rs.153.70, down 2.1 percent.

JKH contributed 45 percent to the day’s turnover of Rs.341.3 million, well below this year’s average of Rs.792 million, with almost one million shares changing hands. 

Brokers said the EPF may be selling JKH shares in a lacklustre market to buy back a share parcel at a more attractive price later. 

However, analysts pointed out, had that been the case, the EPF should know better as pension funds handling public money are considered long-term investors and not short-term traders. 

The EPF is believed to have bought these JKH shares at Rs.170 levels.

The All Share Price Index has fallen 8.3 percent so far this year as foreign investors, unnerved by the global concerns over China’s economy, have cut their exposure.

Foreign investors, who have been net sellers of Rs.2.28 billion worth of equities so far this year, were the net buyers of Rs.3.79 million worth of shares yesterday.

The Central Bank, as expected, kept its key policy interest rates unchanged after market hours on Monday, saying the effects of previous adjustments were still trickling down into the economy and expected private sector credit growth to decelerate slowly.