CSE foreign funds outflow seen as controllable

By Hiran H.Senewiratne 

The outflow of foreign  funds in the CSE can be controlled soon with the return of foreign investors to Asian markets, which performed well compared to other regional markets in the recent past, a top CSE official said.  

“During the  month of September,  the  market has  performed really well and became best in the region. Therefore,  many foreign investors are likely to come back,  Head of CSE Marketing, Niroshan Wijesundara said.

‘At present total foreign outflow would be approximately  Rs. 43 billion. It will not make a major difference to the market  as local investors have become more active than on other days due to the low interest rate regime and also payment of  better dividend yields  for shareholders by certain listed companies, Wijesundara told The Island Financial Review.

He said that prudent government policy decisions will also help the market in a positive manner.

Yesterday the market started trading in a sluggish manner due to a slight decline in Hayleys Group stocks but later it picked up  and turned positive when the indices heavy LOLC witnessed some buying interest, stock market analysts said.

Further, another interest rate cut for banks by the Central Bank, which was anticipated by Moody’s, also gave some positive signals to the market to perform better yesterday. Amid those developments, both indices moved upwards, ie, the All Share Price Index went up by 25.79 points and S and P SL20 by 14.44 points.

The day’s turnover stood at Rs. 3.6 billion with four crossings. Those crossings were reported in Vallibel Power Erathna, which crossed 35 million shares to the tune of Rs. 287 million, its share trading at Rs. 20, JKH, 600,000 shares crossed for Rs. 79.8 million at a per share value of Rs. 133, Tokyo Cement (Non Voting) 400,000 shares crossed for Rs. 22.6 million; its share traded at Rs. 56.50 and Central Finance 250,000 shares crossed for Rs. 21.83 million with its shares trading at Rs. 87.30.

In the retail market top five companies that contributed to the turnover were;  Expolanka Rs. 561 million (three million shares traded),Kelani Tyre Rs. 244.7 million (2.63 million shares traded), Tokyo Cement  (Non Voting) Rs. 167.4 million  (2.97 million shares traded), Tokyo Cement (voting) Rs. 144.4 million (2.2 million shares traded) and Piramal Glass Rs. 140 million (19.5 million shares traded). During the day 195.5 million share volumes changed hands in 28969 transactions.

It is said that foreign investors recorded a net outflow of Rs. 29.6 million compared to a net outflow of Rs. 809.8 million on Wednesday. Separately, Dilmah Ceylon Tea Company announced a final dividend of Rs. 5.00 per share.

The bourse remained resilient, sustaining the drive in a positive direction for the second consecutive session. It said Materials counters led the three billion plus turnover, closely followed by Transportation and Capital Goods counters making a joint contribution of 60 percent.