(EconomyNext) – Investors in Sri Lanka’s stock market upbeat over the opposition win at the presidential polls sent the benchmark index up over 100 points Friday in a buying spree that focussed on banks and manufacturing companies.
The All Share Price Index rose 1.44 percent (108.19 points) to reach 7,605.79 while the S&P SL20 index, which tracks the top 20 largest and most liquid stocks on the Colombo Stock Exchange, climbed 2.07 percent (86.53 points) to reach 4,272.50.
Turnover was 3.7 billion rupees with several crossings or negotiated off-market deal in heavyweights like Hayleys and Dialog Axiata.
"Buying interest was there during the last two days but today the market was extremely bullish," declared Dimantha Mathew, Manager Research at First Capital Equities.
"There was heavy buying with (opposition candidate) Maithripala Sirisena winning the presidential election on Thursday."
Sirisena, representing a broad coalition of opposition parties led by the main United National Party (UNP), defeated incumbent President Mahinda Rajapaksa on a pledge to restore rule of law and create a more stable climate for business.
Investors were enthused by the return to power of the opposition UNP which traditionally has been favoured by the business community for pursing free market economic policies.
UNP leader Ranil Wickremesinghe is expected to be the prime minister in the new government that is being formed.
Mathew of First Capital Equities said investors were optimistic over the reductions in energy prices towards the end of 2014 which will help all manufacturing companies.
"So there was significant interest in manufacturing companies like Piramal Glass and Sierra Cables, Textured Jersey, Tokyo Cement and Renuka Agri," he told EconomyNext.com.
"There was also significant interest in the banking sector. There are a few undervalued banks and those were the ones which saw buying interest, especially Seylan Bank."
Buying interest came not only from big institutional investors but high-net-worth individuals and retailers as well.
There was one crossing of a million shares of Hayleys at 340 rupees each, five deals in Dialog Axiata of 14 million shares at 3.50 and 3.80 rupees a share and two deals of two million shares of Asiri at 22.50 rupees a share.
Other deals were two in Commercial Bank of a total of 697,000 shares at 186 and 190 rupees a share, one crossing of Seylan Bank non-voting of 800,000 shares at 63.50 rupees each and one of 99,000 shares of DFCC Bank at 232 rupees each.
Access Engineering was one of the main shares that fell on concern that it might not win as many new contracts in the island’s construction boom as under the previous administration.