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Sri Lankan shares up for second session on foreign buying

DIMANTHA MATHEW, HEAD OF RESEARCH AT FIRST CAPITAL HOLDINGS PLC, SPEAKS TO REUTERS

AUGUST 06, 2018

COLOMBO, Aug 3 (Reuters) – Sri Lankan shares rose for the second straight session on Friday as foreign investors picked up shares that had been battered in recent days, brokers said.

Sri Lanka’s central bank left its key policy rates unchanged as expected on Friday before the market opened, and said the decision backed its goals for stabilising inflation and fostering sustainable economic growth.

The Colombo stock index ended 0.12 percent firmer at 6,143.90.

The index began the week by marking its lowest close since July 12 and fell 0.16 percent during the week, recording its second weekly decline. It is down 3.5 percent so far this year.

Turnover stood at 150.5 million rupees ($942,391.98), well below this year’s daily average of 844 million rupees.

“The market is moving sideways with low turnover levels as there is not much of selling pressure,” said Dimantha Mathew, head of research, First Capital Holdings.

“The buying interest is there but they are looking at cheaper prices, but there are no sellers which is a good sign for the market.”

Foreign investors bought equities worth a net 49.9 million rupees on Friday, but have been net sellers of 2.6 billion rupees worth of equities so far this year.

Sri Lanka’s central bank governor Indrajit Coomaraswamy on Friday said the economy is unlikely to grow more than 4 percent in 2018, falling short of an earlier estimate of 5 percent.

Shares of Ceylon Tobacco Company Plc ended 0.5 percent up, while Melstacorp Ltd rose 6.03 percent, Dialog Axiata Plc closed 2.1 percent firmer and biggest listed lender Commercial Bank of Ceylon Plc gained 1.5 percent. ($1 = 159.7000 Sri Lankan rupees) (Reporting by Ranga Sirilal; Editing by Sunil Nair)

Atchuthan Srirangan, Assistant Manager – Research at First Capital Holdings, with the Market Review on Ada Derana – 02.08.2018

Stock Market Sri Lanka

First Capital’s Atchuthan Srirangan with the Market Review on Ada Derana

The comments on this report are provided by the Capital Markets Research Unit of First Capital Holdings PLC an investment bank in Sri Lanka.

The company operates in the capital markets of Sri Lanka in government securities – treasury bills and bonds, stock brokering and share market investments, asset management, private wealth management, retirement planning, personal financial planning, unit trust, margin trading, capital market research, trustee services, corporate finance advisory services including corporate debt structuring (debentures, trust certificates, commercial papers), valuations, restructuring, mergers and acquisitions, initial public offerings (IPOs) and project advisory.

The First Capital Group consists of First Capital Treasuries PLC, First Capital Limited, First Capital Markets Limited, First Capital Asset Management Limited and First Capital Equities (Private) Limited covering Colombo, Negombo, Matara, Kandy and Kurunegala.

First Capital is an investment bank offering services as Stock Brokers in Sri Lanka. The Company acts as a conduit between retail and institutional clients and the secondary market of the Colombo Stock Exchange. First Capital’s best-in-class research team provide a series of actionable trade recommendations, daily and periodic market commentaries and publications for Stock Brokers in Sri Lanka.

 

Sri Lanka central bank seen keeping rates unchanged

Economy Next – 03.08.2018

By First Capital Research

ECONOMYNEXT – Sri Lanka’s central bank is likely to keep its policy interest rates unchanged Friday when it makes its monetary policy announcement, First Capital equities said.

Subdued credit growth and slow economic growth warrant a rate cut, the brokerage said in a research note.

But a rate cut would serve to aggravate the continuous foreign outflow from both debt and equity markets thus increasing pressure on the rupee, they said.

“Therefore, we believe in a continuation of the current monetary policy stance. We expect the CBSL to keep Statutory Reserve Ratio (SRR) unchanged at 7.50%.”

Based on economic developments and outlook for key macroeconomic indicators pointing to more economic stability, First Capital increased the probability of a rate cut to 5% from the previous 0% while decreasing the probability of an unchanged policy stance to 95%.
(COLOMBO, 02 August, 2018)

Nisansala Kuruppumudali, Research Analyst at First Capital Holdings, with the Market Review on Ada Derana – 01.08.2018

Share Market Sri Lanka

First Capital’s Nisansala Kuruppumudali with the Market Review on Ada Derana

The comments on this report are provided by the Capital Markets Research Unit of First Capital Holdings PLC an investment bank in Sri Lanka.

The company operates in the capital markets of Sri Lanka in government securities – treasury bills and bonds, stock brokering and share market investments, asset management, private wealth management, retirement planning, personal financial planning, unit trust, margin trading, capital market research, trustee services, corporate finance advisory services including corporate debt structuring (debentures, trust certificates, commercial papers), valuations, restructuring, mergers and acquisitions, initial public offerings (IPOs) and project advisory.

The First Capital Group consists of First Capital Treasuries PLC, First Capital Limited, First Capital Markets Limited, First Capital Asset Management Limited and First Capital Equities (Private) Limited covering Colombo, Negombo, Matara, Kandy and Kurunegala.

Sri Lankan shares hit near 3-week closing low on foreign selling

DIMANTHA MATHEW, HEAD OF RESEARCH AT FIRST CAPITAL HOLDINGS PLC, SPEAKS TO REUTERS

AUGUST 02, 2018

COLOMBO, Aug 1 (Reuters) – Sri Lankan shares ended weaker on Wednesday, hovering at their lowest close in three weeks, as foreign investors offloaded blue-chip stocks such as John Keells Holdings Plc, while lacklustre corporate results dented sentiment further.

The Colombo stock index ended 0.29 percent weaker at 6,129.32, near its lowest close since July 12. The bourse dropped 3.8 percent so far this year

The index dropped 0.47 percent last week, marking its first weekly decline in three.

Turnover stood at 374.4 million rupees ($2.35 million), less than this year’s daily average of 852.6 million rupees.

“The market is down mainly because of the foreign selling,” said Dimantha Mathew, head of research, First Capital Holdings.

“Today the local buying was not there to absorb foreign selling,” he added.

Foreign investors sold equities net worth 116.4 million rupees on Wednesday, extending the year-to-date net foreign outflow to 2.6 billion rupees worth of equities so far this year.

A downward revision in economic growth estimate earlier this month by the central bank also hurt sentiment, analysts said.

Economic growth in 2018 is likely to be between 4 percent and 4.5 percent, falling short of an earlier estimate of 5 percent, Central Bank Governor Indrajit Coomaraswamy said earlier this month.

Shares in conglomerate John Keells Holding Plc ended down 2.6 percent, while Melstacorp Ltd closed 3 percent lower. The biggest-listed lender Commercial Bank of Ceylon Plc ended 1.5 percent down and Distillers Company of Sri Lanka Plc closed 0.4 percent down.