Blue chip stocks boost bourse following three-session decline

By Hiran H. Senewiratne

CSE shares gained in mid-day trade yesterday after slipping for three-straight sessions, pushed up by LOLC, Ceylon Cold Stores and Asiri Hospitals blue chip stocks. Lower level bargain hunters were looking to purchase top stocks, market analysts said.

Amid those developments both indices moved up. The All- Share Price Index went up by 88.6 points and S and P SL20 rose by 72.2 points. Turnover stood at Rs 1.2 billion with three crossings. Those crossings were reported in JKH, which crossed 248,000 shares to the tune of Rs 32.4 million, its shares traded at Rs 130, Kahawatte Plantations 600,000 shares crossed to the tune of Rs 22.8 million, its shares traded at Rs 38 and RIL Properties 3.2 million shares crossed to the tune of Rs 20.2 million, its shares fetched Rs 6.20.

In the retail market top seven companies that mainly contributed to the turnover were; Lanka ILC Rs 286 million (1.5 million shares traded), Expolanka Holdings Rs 156 million (998,000 shares traded), JKH Rs 101.8 million (783,000 shares traded), CIC Holdings Rs 90.9 million (961,000 shares traded), ACL Cables Rs 51.2 million (588,000 shares traded), Browns Investments Rs 41.4 million (seven million shares traded) and CIC Holdings (non-voting) Rs 32 million (494,000 shares traded). During the day 56.2 million share volumes changed hands in 16000 share transactions.

Many Sri Lankan firms showed good results in the June quarter helped by lower-cost inventory and the ability to increase prices as inflation soared.

Since then utility prices are up and workers are beginning to be restive, demanding higher wages, while concerns are emerging about purchasing power. Economies (and firms) generally begin to feel the negative effects of money printing when inflation ceases to accelerate, observers said.

Following the tax hike proposals, stockbrokers said that the market has become bearish as investors moved to a wait-and-see approach as they expect the move to hit fourth-quarter earnings.

Yesterday the Central Bank announced the US dollar buying rate as Rs 360.65 and selling rate as Rs 371.21