Share market: Most sectors witness declines

By Hiran H. Senewiratne

Early trading activities at the Colombo Stock Exchange (CSE)  yesterday indicated some positive trend, but during the day the stock market came down due to panic selling by investors, as a result of Fitch Ratings downgrading Sri Lanka’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘CC’, from ‘CCC’. 

 The investors were worried that the downgrade reflects an increased probability of a default event in coming months in light of Sri Lanka’s worsening external liquidity position, underscored by a drop in foreign-exchange reserves set against high external debt payments and limited financing inflows. The severity of financial stress is illustrated by elevated government-bond yields and downward pressure on the currency, market analysts said.

Amid those developments, CSE activities were somewhat volatile but notable transactions were reported where Prime Finance, which held 87.27 percent or 105.6 million shares  sold its entire stake to HNB Finance for a monetary consideration of Rs 2.1 billion, which took place as a crossing. 

Further, the Cooperative Insurance IPO was oversubscribed yesterday on its first day itself, stock market analysts said.

Both indices were down with All Share Price Index down by 85.2 points and S and P SL20 down by 62.7 points. Turnover stood at Rs 5.4 billion with three crossings. Those crossings were reported in Prime Finance, which crossed 105.6 billion to the tune of Rs 2.1 billion and its share price traded at Rs 22.10, Asian Hotels and Properties 1.2 million shares crossed for Rs 54 million and its share price traded at Rs 45 and Hornana Plantations one million shares crossed for Rs 26.9 million and its share price traded at Rs 26.90.

In the retail market top seven companies that mainly contributed to the turnover were Expolanka Holdings Rs 539 million (1.4 million shares traded), Lanka IOC Rs 267 million (5.7 million shares traded), Browns Investments Rs 228 million (16.4 million shares traded), Hayleys Rs 206.8 million (1.5 million shares traded), United Motors Rs 123 million (1.2 million shares traded), Single (Sri Lanka) Rs 113 million (5.7 million shares traded) and LOLC Holdings Rs 107 million (97000 shares traded). During the day notable price appreciations were witnessed. The Singer (Sri Lanka) share price appreciated by seven percent or Rs 1.30. Its share shot up to Rs 19.40 from Rs 18.10 and Lanka IOC share price appreciated by 10 percent or Rs 4.20. Its share price moved to Rs 47.20 from Rs 43.