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Friday January 21st, 2022
Markets

Sri Lanka stocks gain on bargain hunting 

ECONOMYNEXT – Sri Lanka’s share index gained 1.48 per cent on Monday (22) driven by bargain hunters recouping some of Friday’s losses but still jittery following a 3 per cent plunge in the previous session, brokers said.

“Bargain hunters aggressively bought shares in the market, turning the market around from Friday’s plunge. However, this was only a partial recovery of about 50-per cent from Friday’s,” a Colombo-based a senior analyst said.

“It didn’t really erase all the losses of Friday.”

On Friday, ASPI plunged 3.32 percent as Commercial Leasing & Finance PLC (CLC), an illiquid share tumbled 19 percent after its parent company LOLC transferred several stocks to LOLC Ceylon Holdings Limited (LOCH).

Although the company said the transactions amounted to a major amount no transaction prices were given.

“Market still jittery after Friday’s plunge pushed by illiquid counters although they gained again today.

Low float illiquid counters drove the market index. However, the market was highly volatile,” another market analyst said.

All Share Price Index rose 1.49 per cent or 158.52 points to close at 10,817.24.

S&P SL20 index of the most liquid share gained 0.90 per cent or 33.07 points to close at 3,707.65.

Blue-chip counters such as John Keells Holdings and Sunshine Holdings too witnessed buying interest.

“This is quite a positive sign because we are starting to see some fundamentally strong counters starting to trade a bit and investors are also interested in those counters,” the senior analyst said.

Monday’s market rise comes ahead of the central bank’s monetary policy announcement later this week and analysts expect the interest rates to be increased at least 25 basis points.

Analysts cautioned about signs of market peaking off because of heavy speculative trading amid expert investors are moving aside while newcomers are driving the herd mentality with speculators are cashing out or moving into more defensive counters.

Foreign investors, however, sold a net of 53.2 million rupees worth of shares, extending the net foreign inflow to 47.6 billion rupees so far this year.

The day’s turnover was 6.1 billion rupees above this year’s average daily turnover of 4 billion rupees.

Shares that pushed ASPI up are LOLC Holdings and its subsidiaries – Commercial Leasing & Finance PLC (CLC) and LOLC Finance PLC (LOFC).

Commercial Leasing & Finance PLC rose 10.39 percent to close at 70.10 rupees a share.

LOLC Holdings PLC gained 3.16 percent to close at 768 rupees a share while LOLC Finance PLC gained 6.20 percent to close at 27.40 rupees a share(Colombo/Nov22/2021)

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