Clarification on Finance Minister’s IMF comment boosts bourse

By Hiran H. Senewiratne

CSE trading activities yesterday started on a positive note but within a short time the bourse declined to the 28- points level. Later on, however, strong positive buying interest was noted in blue chip companies resulting in the market moving to positive territory, market analysts said.

On the previous day the market dipped because stock market investors were worried about sentiments expressed by Finance Minister Basil Rajapaksa on the previous day that he would seek an IMF bailout. However, Central Bank Governor Ajith Nivard Cabraal clarified in his twitter account that what the finance minister meant in his statement was that Sri Lanka had sought technical advice from the International Monetary Fund (IMF) on how to better manage debt servicing as well as boost foreign reserves, but had not meant a bail-out, market analysts said.

Amid those developments negative investor sentiment disappeared in the bourse and strong buying interest was witnessed especially in blue-chip counters. Consequently, both indices moved upwards. The All- Share Price Index went up by 178.58 points and S and P SL20 rose by 130.69 points. Turnover stood at Rs 6.4 billion with a single crossing. That crossing was reported in LOLC Finance, which crossed 1.04 million shares to the tune of Rs 28 million, its shares traded at Rs 27.

In the retail market top seven companies that mainly contributed to the turnover were, Expolanka Holdings Rs 1.5 billion (4.7 million shares traded), Softlogic Life Insurance Rs 486 million (3.9 million shares traded), Browns Investments Rs 479 million (31.9 million shares traded), LOLC Holdings Rs 289 million (256,000 shares traded), Sunshine Holdings Rs 219 million (four million shares traded), Hayleys PLC Rs 179 million (1.3 million shares traded) and Watawala Plantations Rs 174 million (1.2 million shares traded).

During the day the company with the highest market capitalization Expolanka Holdings, which contributed 50 points to the All- Share Price Index, appreciated its shares by Rs 30.75 or 10 per cent. Its shares started trading at Rs 314.50 and at the end of the day they shot up to Rs 346.25.

It is said high net worth and institutional investor participation was noted in Ceylinco Insurance, Melstacorp and LOLC Finance. Mixed interest was observed in Expolanka Holdings, Softlogic Life Insurance and Lanka IOC, while retail interest was noted in Renuka Agri Foods, Browns Investments and Softlogic Capital.

Yesterday the US dollar was quoted at Rs 203.17, which was the Central Bank controlled price to prevent prices of essential food items from rising.