Sri Lankan Shares drop sharply; net foreign outflow resumes

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Sri Lanka, Aug 28 (Insights Equity) – Sri Lankan shares recorded the sharpest drop in nearly two months as foreign investors became net sellers for the first time following three straight sessions of net buying positions.

The All Share Price Index (ASPI) declined by 34 points, its highest drop since July 04, 2018, to close the day at 6,010.23, a 0.56 percent lower than the previous session, while S&P SL20, where largest and most liquid stocks are included, dropped nearly 18 points to reach 3,196.97, a decline of 0.55 percent.

The market turnover stood at LKR374.8 mn (USD2.3 mn), well below the year-to-date average daily turnover of LKR815.1 mn (USD5.1 mn) as 44.8 mn of shares changed hands, the highest daily share volume since July 18, 2018, driven by four off-market negotiated trades, after two consecutive sessions of zero crossings.

Amana Takaful witnessed three crossings of 6.25 mn blocks of shares each valued at LKR8.0 per share, leading the daily turnover generation with a contribution of 40 percent, while Melstacorp contributed 19 percent to the turnover with a single crossing of 1.42 mn shares at LKR51 per share.

Sector-wise, the banks, finance and insurance sector made the highest contribution of 56 percent to the turnover, followed by the diversified sector which made up 21 percent.

Furthermore, Nation Lanka Finance and Asia Asset Finance were amongst the top gainers in the market, while SMB Leasing and Piramal Glass were two of the most actively traded stocks for the day.

Market Alert – Local:

Plans are underway for Sri Lanka’s Employee Provident Fund (EPF) to re-enter the Sri Lankan stock market and is already active in the Secondary Market of government bonds, according to Sri Lanka’s Central Bank Governor, economynext reports.

Sri Lanka’s ASPI has dropped by more than 6.3 percent so far this year while other frontier market indices such as Vietnam’s VN-Index has remained stable with only a 0.1 percent decline year-to-date.

Graph - 1Graph - 2OverviewGlobalTurnoverSectorsGainersLosers

Reporting by: Dulan Lokuwithana
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