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Sri Lanka stock market falls 6.5-pct wiping out Rs245bn

ECONOMYNEXT – Sri Lanka stocks plunged 6.5 per cent Tuesday wiping out 245 billion rupees from stock values after making steep gains over several weeks on the back of low interest rates and strong earnings in some firms, brokers said.

Trading was halted twice as falling index hit circuit breakers.

“We are coming off from a 30 percent rise in a month,” Dumith Fernando, Chairman Asia Securities said.

“A lot f people will take profit and take off some of their margins. My view is that fundamental valuations for many good shares are still intact.

“The earnings for coming quarters are strong for many of them. I am not surprised to see profit taking on the back of the rapid rise in recent months. This should create another buying opportunity.

The Colombo Stock Exchange halted trading at 1331 for 30 minutes after the S&P 20 Index fell below 5 percent.

Shortly after re-opening the S&P 20 Index fell below 7.75 percent triggering a second circuit breaker 1417 hours.

The benchmark All Share Index closed 6.56 percent or 561.75 points down close at 8,005.32 for the day with the market rallying in the last few minutes.

The market closed at 1430 with the S&P 20 Index recovering to 6.25 or 215.57 points to close at 3,224.11.

Colombo stocks saw the biggest intra-day fall, First Capital said in a note to clients.





Market turnover was 6.9 billion rupees with 10 stocks making gains and 222 making losses.

Net foreign sales were 179 million rupees.

LOLC Holdings fell 37.25 rupees to close 466.50 rupees a share contributing most for the ASPI fall.

LOLC Development Finance, a part of LOLC holdings, fell 1.75 rupees to 103.25 rupees a share.

John Keells Holdings fell 12.75 rupees to close at 155.75 rupees, with a market capital of 205.4 billion rupees.

Browns Investments, closed 30 cents down at 6.40 rupees a share while its parent Brown and Company fell 20.25 rupees to close at 199.75 rupees.

Vallibel One, controlled by Dhammika Perera closed 17.43 percent or 14.00 rupees down at 66.30 rupees with 72 billion rupees of market capitalization. LB Finance fell 42.00 rupees to close at 258.00 rupees.

Hayleys Plc, fell 30.25 rupees to close at 711.25 rupees a share with key subsidiaries Dipped Products falling 75.75 rupees to close at 613.25 rupees and Haycarb Plc falling 125.50 rupees to close at 1,060.25 rupees.

The Kingsbury Plc another subsidiary of Hayleys group closed 20 cents down at 12.50 rupees.

Hatton National Bank closed 11.75 rupees down at 139.00 rupees, Commercial Bank of Ceylon fell 6.40 rupees to close at 89.90 rupees, DFCC Bank closed 5.90 rupees down at 66.00 rupees and Sampath
bank closed 14.75 rupees down at 180.50 rupees.

Nations trust bank fell 2.70 rupees to close at 60.40 rupees and Seylan Bank fell 3.60 rupees to close at 52.90 rupees while Pan Asia Banking Corporation fell 1.60 rupees to close at 18.40 rupees.

Central Finance Company fell 15.00 rupees to close at 110.50 rupees, Alliance Finance Company fell 2.40 rupees to close at 54.10 rupees and Citizens Development Business Finance fell 4.50 rupees to close at 115.25 rupees.

Sinhaputhra Finance closed 50 cents up at 8.50 rupees a share while Housing Development Finance fell 4.20 rupees to close at 37.90 rupees and Softlogic finance closed 50 cents down at 11.50 rupees a share.

Cargills Ceylon fell 4.50 rupees a share to close at 235.75 rupees, Hemas Holdings fell 4.20 rupees to 89.80 rupees, Distilleries Company fell 1.60 rupees to close at 21.00 rupees and Melstacorp fell 3.80 rupees a share to close at 3.80 rupees.

In the hotel sector Eden Hotel Lanka closed 1.00 rupee down at 11.50 rupees and John Keels Hotels closed 30 cents down at 10.80 rupees a share while Sigiriya Village hotel closed 2.30 rupees down at 37.00 rupees, Aitken Spence Hotel holdings fell 2.10 rupees to close at 31.90 rupees.

Ceylon Tobacco Company fell 24.25 rupees to close at 1,095.50 rupees while Ceylon Cold stores closed 20.25 rupees down at 685.75 rupees.

Carson Cumberbatch fell 57.25 rupees to close at 304.00 rupees while Access Engineering fell 2.20 rupees to close at 26.20 rupees.

Nestle Lanka closed 61.00 rupees down at 1,235.25 rupees and Aitken Spence Plc closed 5.00 rupees down at 64.60 rupees.

Sri Lanka Telecom closed 1.60 rupees down at 35.90 rupees, Dialog Axiata closed 30 cents down at 12.30 rupees while Richard Pieris Company closed 1.10 rupees down at 14.90 rupees.

EB Creasy and Company fell 517.50 rupees to close at 5,613.75 rupees.

Royal Ceramic Lanka closed 63.25 percent down at 319.75 rupees and Lanka Ceramic closed 8.50 rupees down at 177.00 rupees.

The Capital Goods Industry was the most active, fell 9.43 percent and Diversified Financial Industry which was also active fell 7.1 percent today. (Colombo/Feb02/2021)

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  1. What a fascinating picture the brokers are playing around with than valuing the shares properly at the current stratospheric prices, strangely justifying the current prices knowing very well that return to investment is in an artificial state and beyond sensible measured expectations. The most important values of a market broker, is that he or she should have the qualities of honesty, integrity and credibility.

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