Sri Lankan shares rally as political turmoil continues

Sri Lanka, Oct 29 (Capital Leads) – The daily turnover of the Colombo Stock Exchange (CSE) exceeded LKR4 bn today, as the market, driven by local buying in conglomerates, rose sharply for the second consecutive session to reach a more than one-month high.

However, the year-to-date net foreign outflow surpassed LKR12 bn as rising political tensions in the country weighed on the foreign investor sentiment.

On Friday, Sri Lankan President, Maithripala Sirisena dismissed Ranil Wickramasinghe as Prime Minister and appointed the former President Mahinda Rajapakse as the new Prime Minister. However, Mr. Wickramasinghe claims he remains to be the Prime Minister as he commands the majority in Parliament.

ASPI climb to a more than one-month high: Posting its sharpest one-day gain for the year, the broad market All Share Price Index (ASPI) with a gain of 112.22 points ended 1.92 percent higher to reach 5,944.18 points, its highest close since September 19, 2018.

Meanwhile, S&P SL20 where the largest and most liquid stocks are included, climbed 2.04 percent to stand at 3,058.59 points, 61.26 points higher than the previous session.

Crossings generate 84 percent of turnover: The day’s turnover reached LKR4.2 bn (USD24.1 mn), more than five times the year-to-date average daily turnover of LKR785.2 mn (USD4.5 mn) as 66.0 mn shares changed hands with crossings of John Keells Holdings (JKH), Hatton National Bank (HNB) and Softlogic Holdings (SHL) accounting for 84 percent of the day’s turnover.

Year-to-date net foreign outflow exceeds LKR12.8 bn: The day’s net foreign outflow stood at LKR3.0 bn (USD17.7 mn), as foreigners offloaded diversified holdings, extending the year-to-date net foreign selling to LKR12.8 bn (USD74.2 mn).

JKH contributes more than 70 percent of turnover; gains over one percent: JKH, gaining 1.3 percent, enticed local investor interest as the stock with 71 percent of contribution to the day’s turnover witnessed six crossings of 19.6 mn shares at LKR141.0.

Meanwhile, HNB gaining 0.8 percent driven by local buying contributed 11 percent as the stock traded 2.0 mn shares off-board at LKR205.0 – 210.0.

Diversified Holdings standing 2.5 percent higher dominated the sector-wise contribution with 81 percent followed by banks, finance and insurance stocks which made up 14 percent.

Furthermore, Adam Capital and Singer Industries were two of the highest gainers of the market today while Access Engineering and Tess Agro were among the most actively traded counters of the day.

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