The Bourse Weekly Performance (Week-ended 27th September 2013)

The Bourse Weekly Performance (Week-ended 27^th September 2013)

	Week-ended 20th September 2013	Week-ended 27th September 2013
All Share Price Index	5,814.10	5,808.62
S&P SL20 Index	3,217.60	3,210.30
Total Turnover for the week (Rs.)	3,146,276,515/-	3,214,899,732/-
Total Net Foreign Inflow/ (Outflow) (Rs.)	(250,638,612/-)	687,835,103.00
Market Capitalisation (Rs.)	2,394,602,797,442/-	2,392,346,681,121/-
Market PER	16.54	16.52

In local news, Touchwood was seen to be rallying following a change in its board of directors and the announcement made at the AGM. The senior management headed by the then acting CEO announced that it expects to pay off all its current obligations while making a speculative statement that it expects the Touchwood share price to rise to Rs. 15 in the future. Many analysts viewed this as a biased statement, while the share price fluctuated over 45% on Thursday alone. Subsequently trading of the share was halted on Friday by CSE, pending disclosure on media reports.

There was an increase in foreign interest in the aftermath of the Federal Reserve’s decision last week. Growing uncertainties on the economic growth in the US economy has resulted in foreign interest deviating from the western economies and for global investors to take to the sidelines. Recently Bloomberg reported that “Americans are losing faith in the nation’s economic recovery even as forecasters expect growth to accelerate, according to a Bloomberg National Poll”. However, the weekly performance of the Asia Pacific markets indicated negative market performance where the Indonesian stock exchange (Jakarta Comp) made the biggest loss of 3.49% within the previous 5 days. Foreigners were net buyers at the CSE this week, with a weekly net foreign inflow of Rs. 688 Million.

This week the ASI and S&P indices lost marginally, where the indices fell 5 and 7 points respectively. This is equivalent to a Rs. 2 Billion loss in market capitalization. Though turnover levels remained in line with the previous week, the highest contributor for the weekly turnover was seen to be Banking Finance and Insurance sector. The biggest loser this week was seen to be Footwear and Textile sector while the biggest gainer was the Information Technology sector. The Colombo bourse currently, generates a year to date gain of 2% in terms of its ASI.

The Bourse Weekly Performance (Week-ended 20th September 2013)

The Bourse Weekly Performance (Week-ended 20^th September 2013)

	Week-ended 13th September 2013	Week-ended 20th September 2013
All Share Price Index	5,749.46	5,814.10
S&P SL20 Index	3,176.74	3,217.60
Total Turnover for the week (Rs.)	3,494,289,658/-	3,146,276,515/-
Total Net Foreign Inflow/ (Outflow) (Rs.)	874,827,901/-	(250,638,612/-)
Market Capitalisation (Rs.)	2,368,050,552,133/-	2,394,602,797,442/-
Market PER	16.35	16.54

The early part of the week saw the Colombo bourse dipping once again and reaching its one-week low levels. However, it opened trading on Friday following the poya-holiday with new interest and with the news of the decision by the US Federal Reserve to not to taper the stimulus programme. This latest development revitalized an if not dull bourse and the mini rally on Friday, saw a gain of 106 points in terms of the ASPI.

Until the announcement of the decision by the US Federal Reserve on Wednesday, global Financial Analysts and investors anticipated a cut to the US Stimulus programme, which resulted in a significant decline in the emerging/ Asian markets as well as the drain out of foreign funds from these economies. Financial Times reported that the spillover effect of such a move would likely be detrimental to some Asian economies. However, surprising the expectations the Federal Reserve decided to continue the stimulus programme explaining it waits for more evidence of solid economic growth. As per Reuters recent reports, world shares steadied at a five-year high on Friday and bond and commodity markets were consolidating a week of major gains after the U.S. Federal Reserve's shock decision. This move was welcomed by analysts and investors in the domestic market, indicating that it would have a positive impact on the Colombo Bourse and its blue chip counters as well as the LKR.

The positive close for an eventful week saw the ASPI and S&P indices gaining 64 and 40 points respectively. This is equivalent to Rs. 26.5 Billion growth in market Cap. The turnover levels remained low this week. Though the latter part of the week saw foreigners being net buyers, the doubtful expectations during the early part of the week resulted in a net foreign outflow. The largest contribution for the weekly turnover came in from Diversified Holdings sector driven by JKH. Over 8 Million shares of JKH traded this week and the share closed on Friday at Rs. 218/-. The biggest gain in sector indices for the week was reported in the Stores and Supplies sector while the biggest loser was the Beverage Food and Tobacco sector.

The Colombo bourse currently records very low year to date returns at 3% in terms of ASPI. However, analysts are hopeful that the recent developments in the global markets would result in improved market sentiments.

The Bourse Weekly Performance (Week-ended 13th September 2013)

The Bourse Weekly Performance (Week-ended 13^th September 2013)

	Week-ended 6th September 2013	Week-ended 13th September 2013
All Share Price Index	5,672.64	5,749.46
S&P SL20 Index	3,177.17	3,176.74
Total Turnover for the week (Rs.)	1,728,463,487/-	3,494,289,658/-
Total Net Foreign Inflow/ (Outflow) (Rs.)	(36,876,254/-)	874,827,901/-
Market Capitalisation (Rs.)	2,336,407,641,240/-	2,368,050,552,133/-
Market PER	16.13	16.35

The Colombo bourse hit 8-month low levels on Monday 9^th September making year to date losses, and trading in the over sold territory. However, the market rebounded on foreign buying making year to date gains. Recent stock broker reports quote ““the stock market regained and closed with positive returns for the first time in the month of September along with the renewed investor confidence about economic growth and the probable positive response from foreign investors who participated at the Investor Forum held in Hong Kong” on Monday”. These renewed interest, at the bourse resulted in the weekly change in the ASI and S&P indices being +76.82 and -0.43 points respectively.

In important announcements this week, following the concerns relating to CFIL and Touchwood the previous week, SEC issued directives on the suspension of trading on Touchwood for three market days and the commencement of a formal inquiry in to the same. After the commencement of trading on Friday, the share closed 46.15% up from its previous close.

In global market news, Reuters reported, that Japan's Nikkei share average inched up 0.1 percent in choppy trade on Friday as many investors awaited next week's U.S. Federal Reserve meeting reaching its 2^nd straight weekly gain. The Financial Times indicated that the weekly performance of the Asia Pacific markets, have been in the green with Indonesia (Jakarta Comp) and China (FTSE Xinhua) reporting the highest gains. However, Bloomberg Global Poll of investors reported that the anticipated reduction in stimulus by the Federal Reserve that has roiled the financial markets for months will be seen as no big deal if it goes ahead next week. Thus, the latest developments in to the Syrian conflict with US and Russia seen to be encouraging Syrian peace talk and the uncertainties involved with the tapering of stimulus by the Federal Reserve was seen to have boosted investor confidence on a global platform.

This week’s turnover doubled from that of previous week with foreigners contributing Rs. 874 Mn as net foreign inflow. Year to date the Colombo bourse has seen a foreign net buying of Rs. 19.37 Billion. Highest contributor for the weekly turnover was the Diversified Holdings sector generating over Rs. 2 Bn which is 62% of this week’s turnover driven by JKH.

Analysts indicate that the current price weakness in the Bourse provides an excellent opportunity for medium to long-term investors to pick up attractively priced growth stocks. They explain that while positive market sentiment appears to be building up, it is advised to enter the market in a focused and informed manner selecting counters that will fully benefit from the positive domestic and foreign economic conditions.