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Colombo Stock Market wrapped the weekly operations with negative returns for the second consecutive day as the blue-chips tumbled despite the higher institutional activity. Benchmark index failed to recover from previous session loss and index closed at 7,042.06, down by 28.07 index points or 0.40%. 20-scrip S&P SL index shed 22.94 index points (-0.60%) to close the session at 3,804.95.

Index performance drifted to negative territory as premier blue-chip, John Keells Holdings (closed at LKR 175.80, -1.8%) lost ground along with price reductions in Hemas Holdings (closed at LKR 82.50, -1.3%), Bukit Darah (closed at LKR 590.00, -1.7%) and Dialog Axiata (closed at LKR 11.10, -1.8%).

Daily market turnover reached 10 week high of LKR 1.9bn supported by hefty crossings which represented 76% of the total turnover. Off-the-floor dealings were recorded in Commercial Bank (5.0mn shares at LKR 155.00-156.00), Distilleries (1.8mn shares at LKR 275.00), Hatton National Bank (0.5mn shares at LKR 218.00), John Keells Holdings (LKR 0.3mn shares at LKR 173.50) and Vidullanka (6.0mn shares at LKR 6.50).

Accordingly, top positions of turnover list were shared among blue-chips namely Commercial Bank (LKR 798mn), Distilleries (LKR 516mn), Hatton National Bank (LKR 112mn) and John Keells Holdings (LKR 55mn).

Negative investor sentiment reflected across the board where 120 scripts slipped, 75 scripts advanced while 51 remained unchanged. Cash map slightly dipped from 34% to 32%. 16 counters declined to 52wk low price levels.

Continued selling pressure was seen in Hayleys Fibre following the 53%YoY profit drop in September quarter. Counter closed the session at LKR 66.20, down by 21.3%. Meanwhile, net earnings for the 3QFY2015 of Overseas Realty declined by 14%YoY and stock stepped to a fresh 52wk low price of LKR 20.50. However stock closed at LKR 21.00 (-2.3%).

Despite the strong profit growth in Textured Jersey (+66%YoY) and Sanasa Development Bank (+59%YoY), both counters closed with flat returns. Sanasa Development Bank closed at LKR 154.50, -0.3% while Textured Jersey closed at LKR 32.70. Most of the banks such as National Development Bank, Commercial Bank, Sampath Bank, Nation Trust Bank and HDFC Bank end the session on red note.

Foreign investors remain as net sellers for the third consecutive session with a net foreign outflow of LKR 258mn. Foreign participation advanced to 19 month high of 71%. Net foreign outflows were seen in Commercial Bank (LKR 224mn), John Keells Holdings (LKR 43mn) and Union Bank (LKR 7mn) while net foreign inflow was mainly seen in Royal Ceramic (LKR 18mn).

During the week ASI declined by 39.43 points or 0.56% while S&P SL 20 index lost by 18.83 points or 0.49%. Lanka Cement (+8%), Panasian Power (+6%) and Asiri Hospital Holdings (+4%) were among the top gainers of the week while Hayleys Fibre (-23%), Radiant Gems (-20%) and Richard Pieris Exports (-7%) were among the top losers.

The average weekly turnover increased by 9% to LKR 1.1bn. Commercial Bank topped the weekly turnover list with LKR 1.4bn followed by Distilleries (LKR 796mn) and Access Engineering (LKR 250mn).

The foreign investors stood on the selling side for the week recording a net foreign outflow of LKR 780mn. Foreign activity improved from 34% to 55%. Net foreign outflows were mainly seen in Commercial Bank (LKR 715mn), Hatton National Bank non-voting (LKR 78mn), Distilleries (LKR 55mn) while net foreign inflows were mainly seen in Textured Jersey (LKR 58mn) & Hatton National Bank (LKR 38mn). Subsequent to this week’s net foreign outflow, year-to-date net foreign outflow inclined from LKR 2.9bn to LKR 3.7bn.

According to the data released by Department of census and statistics, the annual average inflation rate further remained unchanged at 0.7% in October. The year-on-year change was +1.7% after consecutive three months of deflation.

Further, during the month of October, benchmark index marginally declined by 8.81 index points (-0.1%) while S&P SL20 index shed 23.15 index points (-0.6%). Foreign investors were net sellers for the month with a net foreign outflow of LKR 534mn while participation was 39%.

(Courtesy: Lanka Securities Research)