CSE suspends trading after active S&P SL20 index plunges by 5%
Intraday loss hits 5-month high of 281 points
The Colombo stock market suffered an ominous start for the new month of October as the active S&P SL20 index plunged by 5% forcing the suspension of trading though slightly before the scheduled closure.
“Market turns downbeat with retail sell-off in heavyweights triggering circuit breaker,” said Asia Securities whilst First Capital said: “Market nosedives as retail favourites hit the skids.”
The CSE ended yesterday with S&P SL20 down by 3.68% or over 166 points and the ASPI by 2.8% or 281 points. Turnover was only Rs. 2.5 billion involving 125.3 million shares.
The inauspicious start for October comes after the CSE ended September completing three consecutive months of gains and erasing a fair chunk of losses suffered in the early part of the year (see https://www.ft.lk/front-page/CSE-notches-third-consecutive-month-of-gains-record-foreign-inflow/44-740488).
Asia Securities said the market commenced the week on a downbeat note as retail and HNI sell-off in S&P SL 20 stocks triggered the 5% circuit breaker at the back-end of the session leading to a market-wide trade halt for the day.
Sharp price declines in EXPO (-9.3%), LIOC (-5.2%), LOLC (-4.4%), LOFC (-4.6%), RCL (-8.7%), AAIC (-5.6%), and DIPD (-4.1%) dragged the indices markedly while price losses in active counters LWL (-6.2%), CICX (-5.9%), RICH (-5.6%), AGST (-4.1%) and PACK (-5.8%) added more downward pressure during the session.
Nevertheless, healthcare sector stocks AMSL (+11.7%), NHL (+10.7%), ASIR (+9.5%), and LHCL (+8.8%) witnessed some positive momentum despite broad-based selling. Turnover was supported by LIOC (Rs. 571 million), EXPO (Rs. 503 million), and ACL (Rs. 115 million). Overall, 191 stocks ended lower for the day while 26 closed in green.
Asia also said foreigners recorded a net inflow of Rs. 44.1 million with net foreign buying topping in MELS at Rs. 13.2 million and selling in CFLB at Rs. 1.9 million.
First Capital said the bourse dived deep in red with the intraday loss hitting a five-month high of 281 points, while the market came to a halt at the latter part of the session as S&P SL20 index plunged over 5% from the previous close.
Selling pressure took charge as soon as the market opened while profit booking intensified in retail favourite counters LIOC and EXPO, following the fuel price revision and significantly shrinking freight rates, respectively. In consequence, ASPI declined sharply throughout the session. First Capital also said the dip in the equities market took place as bond yields surged higher in the last primary auction.
NDB Securities said high net worth and institutional investor participation was noted in Aitken Spence, John Keells Holdings and CIC Holdings. Mixed interest was observed in Lanka IOC, Expolanka Holdings and ACL Cables whilst retail interest was noted in SMB Leasing (voting and nonvoting), Browns Investments and Renuka Agri Foods.
Energy sector was the top contributor to the market turnover (due to Lanka IOC) whilst the sector index lost 5.14%. The share price of Lanka IOC decreased by Rs. 15 (5.19%) to close at Rs. 273.75.
Transportation sector was the second highest contributor to the market turnover (due to Expolanka Holdings) whilst the sector index decreased by 9.30%. The share price of Expolanka Holdings lost Rs. 20.25 (9.31%) to close at Rs. 197.25.
ACL Cables, Royal Ceramics and Chevron Lubricants were also included amongst the top turnover contributors. The share price of ACL Cables moved down by Rs. 6.50 (5.66%) to close at Rs. 108.25. The share price of Royal Ceramics recorded a loss of Rs. 3.60 (8.67%) to close at Rs. 37.90. The share price of Chevron Lubricants appreciated by Rs. 3 (2.80%) to close at Rs. 110.
FT