Banking and insurance sector counters ‘warmly welcome’ DDR

By Hiran H.Senewiratne

CSE investors yesterday warmly welcomed the Domestic Debt Restructuring (DDR) exercise, especially banking and insurance sector counters. From 2020 onwards, banking sector counters traded under/lower prices but investor sentiment changed from yesterday for these counters, market analysts said.

From 2020 investors were moving away from investing in banking sector counters due to the latters’ negative image and bank balance sheet issues. But investor appetite quickly shifted to banking sector counters following government and Central Bank assurances that the DDR exercise would not be applicable to the banking and insurance sectors, analysts said.

Amid those developments stocks closed up 7.06 percent with banks leading the charge after domestic bond restructuring was restricted to pension funds, brokers said.

Both indices moved upwards. The All Share Price Index closed up 7.00 percent or 633.07 points to reach 10,109.41, accordingly. The S&P SL 20 Index’s more liquid stocks closed at 10.18 percent or 276.26 points to settle at 2,989.91.

The market generated a turnover of Rs 7.29 billion with nine crossings. Those crossings were reported in JKH, which crossed 4.6 million shares to the tune of Rs 714 million; its shares traded at Rs 156, Melstacorp 3 5.4 million shares crossed for Rs 349 million; its shares traded Rs 65, Commercial Bank 3.1 million shares crossed to the tune of Rs 245 million and its shares traded at Rs 80, National Trust Bank 810,000 shares crossed for Rs 65.5 million, its shares traded at Rs 81, Hayleys 673,000 shares crossed to the tune of Rs 51.5 million and its shares traded at Rs 83, Lanka IOC 316,000 shares crossed for Rs 41.5 million and its shares fetched Rs 131, Chevron Lubricants 451,000 shares crossed for Rs 40.6 million; its shares traded at Rs 90, HNB 200,000 shares crossed for Rs 32 million; its shares traded at Rs 160 and Commercial Bank (Non -Voting) 400,000 shares crossed to the tune of Rs 26.4 million and its shares traded at Rs 66.

In the retail market top seven companies that mainly contributed to the turnover were; Commercial Bank Rs 634 million (7.9 million shares traded), Browns Investments Rs 433 million (68.5 million shares traded), Sampath Bank Rs 371 million (5.8 million shares traded), NTB Rs 310 million (3.9 million shares traded), Hayleys Rs 298 million (3.6 million shares traded), Capital Alliance Rs 295 million (7.5 million shares traded) and LOLC Finance Rs 240 million (41.1 million shares traded). During the day 333.5 million share volumes changed hands in 42000 transactions.

The shares closed higher, with more foreign participation being seen in the market due to positive macro-economic sentiments, an analyst said. Yesterday the bonds closed higher, dealers said and the spot closed stronger at Rs 306.50/308 to the US dollar. The rupee closed at Rs 308.30/310 yesterday.