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Sri Lanka stocks end 3.74-pct higher as credit monitoring eased

ECONOMYNEXT – Sri Lanka stocks gained 3.74 percent recouping losses Monday recouping losses after sentiments some investors improved with expectations credit monitoring being removed, brokers said.

Turnover was 2.7 billion rupees with 173 stocks gaining and 25 falling.

The Colombo benchmark All Share Price Index gained 263.94 points to close at 7,318.43.

The market reached an intraday high at 7,343.72 during the last hour into trading.

The S&P SL20 index of more liquid stocks gained 4.12 per cent or 115.12 points to close at 2,906.69.

The regulators removed a requirement to monitor broker credit mid-month.

The Colombo Stock Exchange said it was withdrawing the requirement with over concerns expressed over ” practical challenges in complying with Regulatory Measures on Monitoring Credit Exposure Undertaken by Stockbrokers/Dealers.”

“Following discussions held today between the Stockbrokering community, The Colombo Stock Exchange and The Securities and Exchange Commission of Sri Lanka it was decided to withdraw the requirements applied on the Stockbroker Firms via the latest Circulars bearing number 04-03-2021 dated 08th March 2021 due to the system limitations and practical constraints regarding the submission of certain information.”

Many investors blamed the credit monitoring rule for the market fall in February.

Analysts say if the opinion was was correct it showed that the market was rising on easy money. Such ‘exuberance’ generally runs out of steam and there is a correction, which is not unusual.

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If the opinion was correct regulators may be saved many potential newcomers who would have otherwise bought stocks at high prices, they say.

Sri Lanka’s balance of payments had been broadly out of line with interest rates from around August 2019, when liquidity injections began and prudent monetary policy ended, analysts say.

LOLC Holdings gained 21.25 rupees to close at 328.00 rupees contributing most for the ASPI gain.

LOLC Finance, gained 30 cents to close at 6.40 rupees, Browns and Company gained 23.50 rupees to close at 175.25 rupees and Browns Investment closed 40 cents up at 5.60 rupees.

Expolanka gained 4.10 rupees to close at 48.40 rupees and Melstacorp Holdings closed 2.80 rupees up at 48.00 rupees a share.

Vallibel One gained 6.90 rupees to close at 54.50 rupees and John Keells Holdings gained 1.25 rupees to close at 150.00 rupees.

Hayleys Plc closed 5.90 rupees up at 60.40 rupees with key subsidiaries Dipped Products gaining 6.80 rupees to close at 50.10 rupees and Haycarb Plc gaining 12.70 rupees to close at 103.50 rupees.

Commercial Bank of Ceylon closed 1.30 rupees down at 86.20 rupees and Hatton National Bank closed 3.75 rupees up at 130.00 rupees.

DFCC Bank closed 2.20 rupees up at 62.30 rupees, Sampath bank closed 3.00 up at 153.25 rupees and the Nations trust bank gained 20 cents to close at 57.50 rupees.

Seylan Bank closed 4.40 rupees up at 54.40 rupees and Pan Asia Banking Corporation gained 1.10 rupees to close at 17.10 rupees.

Central Finance Company gained 1.20 rupees to close at 86.00 rupees, Alliance Finance Company gained 80 cents to close at 50.70 rupees and Citizens Development Business Finance close 5.50 rupees up at 107.75 rupees.

Ceylinco Insurance closed flat at 2,060.00 rupees and Housing Development Finance gained 30 cents to close at 34.50 rupees.

Ceylon Tobacco Company closed 11.00 rupees down at 1,014.25 rupees while Ceylon Cold stores closed flat at 635.00 rupees and Piramal Glass Ceylon closed flat at 9.80 rupees.

Royal Ceramic Lanka closed 28.75 rupees up at 260.75 rupees, Lanka tiles gained 9.50 to close at 186.00 rupees, Lanka Walltiles closed 17.50 rupees up at 197.25 rupees.

Cargills Ceylon closed 2.25 rupees up at 235.00 rupees, Distilleries Company gained 1.10 rupees to close at 21.00, Hemas Holdings closed 2.70 rupees up at 81.90 rupees and Ceylon Grain Elevators gained 5.75 rupees to close at 120.50 rupees.

In the hotel sector Eden Hotel Lanka closed 10 cents up at 10.60 rupees also Sigiriya Village hotel closed 1.70 rupees up at 33.40 rupees, John Keels Hotels closed 10 cents up at 10.10 Aitken Spence Hotel holdings gained 10 cents to close at 29.80 rupees.

Carson Cumberbatch closed flat at 283.00 rupees while Access Engineering gained 50 cents to close at 23.10 rupees.

Nestle Lanka closed flat at 1,188.75 rupees and Aitken Spence Plc closed 20 cents up at 59.10 rupees.

Sri Lanka Telecom closed 80 cents up at 33.80 rupees, Richard Pieris and Company closed 20 cents up at 16.70 rupees and Dialog Axiata closed 20 cents up at 12.90 rupees.

The Capital Goods Industry was the most active, gained 5.3 per cent today. (Colombo/March 08/2021)

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