Sri Lankan shares hit 2-1/2-week closing low; block deals boost turnover

FIRST CAPITAL’S HEAD OF RESEARCH, DIMANTHA MATHEW, SPEAKS TO REUTERS

Sri Lankan shares fell on Monday to hit their lowest close in more than two weeks as investors were worried over rising interest rates, but foreign buying and block deals in Expolanka Holdings boosted the turnover.

Foreign investors net bought 716.2 million rupees worth of equities on Monday, reversing the year-to-date net foreign outflow to an inflow of 580.7 million rupees worth of equities so far this year.

The Colombo stock index ended down 0.24 percent at 6,122.04, its lowest close since Feb. 9.

“Selling pressure on John Keells brought the market down,” said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

“Investor sentiment is negative due to the rising interest rates and most of the investors are on a wait-and-see approach,” he added.

Shares in conglomerate John Keells Holdings Plc slid 1.20 percent, while Hatton National Bank Plc slipped 2.04 percent.

Expolanka Holdings Plc, which accounted almost half the day’s turnover, climbed 1.72 percent on foreign buying.

Turnover stood at 1.35 billion rupees ($8.90 million), well more than this year’s daily average of 625.2 million rupees.

Yields on treasury bills have risen to a more-than-four-year high since October, while the central bank has kept key policy rates on hold.

($1 = 151.7500 Sri Lankan rupees)

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Sherry Jacob-Phillips)

 

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 edge up as investors pick up bank stocks

FIRST CAPITAL’S HEAD OF RESEARCH, DIMANTHA MATHEW, SPEAKS TO REUTERS

Sri Lankan shares rose slightly on Wednesday from a more than one-week closing low hit in the previous session as investors bought banking shares, but concerns over rising interest rates weighed on sentiment.

Yields on treasury bills rose 3-10 basis points at a weekly auction on Tuesday. They have risen 44-73 basis points since Oct. 7 to more than four-year highs, while the central bank has kept key policy rates on hold.

The Colombo stock index ended 0.04 percent firmer at 6,129.69, snapping a four-session losing streak and edging up from its lowest close since Feb. 9 hit on Tuesday.

“Some crossings in blue chips boosted the turnover. Other than that, there was nothing and the market was very dull as investors are still on the sidelines,” said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

“Selling pressure is there, but there are no buyers.”

Shares in Lanka ORIX Leasing Company Plc rose 4.18 percent, while Nestle Lanka Plc, which posted a 42 percent rise in profit for the quarter ended Dec. 31, climbed 2.02 percent.

Turnover stood at 482.7 million rupees ($3.19 million), well below this year’s daily average of 612.5 million rupees.

Foreign investors net bought 37.8 million rupees worth of equities on Wednesday, but they have net sold 215 million rupees worth shares so far this year.

 

($1 = 151.1000 Sri Lankan rupees)

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)

 

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 more than 1-wk closing low as rising rates weigh

FIRST CAPITAL’S HEAD OF RESEARCH, DIMANTHA MATHEW, SPEAKS TO REUTERS

Sri Lankan shares hit a more than one-week closing low on Tuesday, their fourth straight session of losses, as investors sold shares of blue chip companies such as John Keells Holdings Plc amid concerns over rising interest rates.

The Colombo stock index fell 0.2 percent to 6,127.49, slipping to its lowest close since Feb. 9.

“We have seen some interest on retail sector counters,” said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd. “Investors are mainly waiting for some positive news and now watching the direction of the fixed-income segment.”

Yields on treasury bills rose 3 to 10 basis points at a weekly auction on Tuesday. They have risen 44 to 73 basis points since Oct. 7 to more than four-year highs, while the central bank has kept key policy rates on hold.

Conglomerate John Keells Holdings Plc dropped 0.6 percent, while Ceylon Tea Services Plc fell 11.1 percent.

Turnover stood at 300.4 million rupees ($1.99 million), less than half this year’s daily average of 616.2 million rupees.

Foreign investors net bought 19.9 million rupees worth of equities on Tuesday, but have net sold 252.8 million rupees worth shares so far this year.

Investors are expected to wait for direction from the outcome of a sovereign bond issue, analysts said.

The Sri Lankan cabinet last week approved a $1.5 billion sovereign bond issue to repay loans and manage interest payments.

($1 = 151.1500 Sri Lankan rupees)

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)

 

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.

MARKET UPDATE ON ADA DERANA ENGLISH NEWS – 2017.02.20

FC Head of Research Dimantha Mathew with the market update – between 16.40 mins to 17.13 mins

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 fall for 3rd session; blue-chips down

FIRST CAPITAL’S HEAD OF RESEARCH, DIMANTHA MATHEW, SPEAKS TO REUTERS

Sri Lankan shares hit a one-week closing low on Monday, as investors sold shares of blue chip firms such as Ceylon Tobacco Company Plc and John Keells Holdings Plc amid concerns over rising market interest rates.

The Colombo stock index fell 0.33 percent to 6,139.51, slipping for a third straight session to its lowest close since Feb. 13.

“Blue-chips brought the market down. The profit-taking is still continuing and investors are more on a wait and see approach,” said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

“The buying interest is there, but at a lower level. So investors are waiting to buy at cheaper rates.”

Shares of Ceylon Tobacco Company Plc fell 1.83 percent, while conglomerate John Keells Holdings Plc dropped 1.22 percent.

Turnover stood at 728.9 million rupees ($4.83 million), more than this year’s daily average of 625.5 million rupees.

Foreign investors offloaded a net 34.88 million rupees worth of equities on Monday, extending the year-to-date net foreign outflow to 272.7 million rupees worth of shares.

The market will remain slow for the next few days and many investors will wait for directions from a sovereign bond issue, Mathew said.

The Sri Lankan cabinet last week approved a $1.5 billion sovereign bond issue to repay loans and manage interest payments.

Yields on treasury bills are hovering at a more than four-year high.

($1 = 150.8300 Sri Lankan rupees)

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)

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.

 

US bond rate increase good for CSE; not so much for local bonds

FIRST CAPITAL’S  SENIOR RESEARCH ANALYST ATCHUTHAN SRIRANGAN, SPEAKS TO THE SUNDAY TIMES

Foreigners rally in cash at CSE

Despite being one of the poorest performing markets in the region, Sri Lanka’s stock market which has been in the doldrums has attracted a lot of foreign buying interest since of late.

This heavy investor participation stems mainly from the rate increase in the US bond market. While the rates going up is seeing foreign funds shifting back to the US from frontier markets such as Sri Lanka, a small component of their corresponding funds which invest in stock markets  are being ploughed into the Colombo Stock Exchange (CSE), analysts say.

There has been continuous foreign selling in local bonds and as at January 1, 2017 it was US$ 2 million.  The new regime under Donald Trump is trying to strengthen the US Dollar and luring back  funds  to the US.

Atchuthan Srirangan, Senior Research Analyst First Capital Equities noted that on the back of all this, this month’s foreign inflow at CSE was Rs. 600 million as at February 8. Mr. Srirangan said that in the year to date the total foreign participation so far is more than 50 per cent of CSE’s turnover, while for the same period last year it’s 38 per cent.

But why put cash in the CSE? 

That’s due to most shares at the CSE trading at 4x their price to Earnings Ratio (PER) which has made these bargain counters for foreign investors. Foreign fund managers say that CSE is a good investment this year owing to superior earnings projections, low valuations and the potential for better earnings.

From January 1 to 8 February, foreigners bought Rs. 7.67 billion and sold Rs. 8.63 billion. While the net outflow is Rs. 1.026 billion, analysts note that some foreign selling was done to foreigners themselves.

Analysts say that a considerable foreign play was done by Norway’s $830 billion sovereign wealth fund, locally managed by Lynear Wealth Management. The fund has been increasing its focus on emerging countries but only has about 4 per cent of its assets managed externally.   Negotiated deals were recorded in many counters early this month – mostly blue chips and mid-caps bought by foreign funds — Hatton National Bank (0.7 million shares at Rs. 227) and Commercial Bank (0.2 million shares at RS. 145). The aggregate value of crossings accounted for 45 per cent of the turnover. Subsequent to its scrip dividend announcement, Sampath Bank attracted high investor preference where stock price increased to Rs. 267 up by 0.8 per cent.

On February 2, foreign investors stood on the ‘buy’ side with a net foreign inflow of Rs. 90 million. Net foreign inflows were seen in Commercial Bank at Rs. 29 million, Sampath at Rs. 29 million, Melstacorp at Rs. 17 million while net foreign outflows was mainly seen in Seylan Bank (Rs. 5 million). Foreign participation was 66 per cent.

Hemas Holdings saw 2.8 million shares crossed at Rs. 104 on February 2. Its main buyer in 3Q17 was Morgan Stanley and Co: International PLC. But Franklin Templeton Investment Funds had reduced its position in Hemas during the same period.

Overseas Realty Rights Issue saw a 24 per cent acquisition by Jilansu Tao Shing Pee Education Foundation on February 3. Foreign investors were net buyers with a new foreign inflow of Rs. 27 million on this day and net foreign inflows were mainly seen in Sampath Bank Rs. 35 million, Melstacorp Rs. 13 million and Tokyo Cement non-voting Rs. 12 million. That following Monday foreign investor activity accounted for 47 per cent of the turnover.

The day after foreign investors stood on the ‘buy’ side with a net foreign inflow of Rs. 111 million. Net foreign inflows were seen in John Keells Holdings (JKH) Rs. 51 million, Hemas Holdings Rs. 30 million, and Nestle Rs. 28 million while net foreign outflow was mainly seen in National Development Bank Rs. 4 million. Foreign participation was 52 per cent that day. On February 8 foreign investors were net buyers with a net foreign inflow of Rs. 152 million. Net foreign inflows were seen in JKH (Rs. 103 million), Sampath Bank (Rs. 49 million) and Melstacorp (Rs. 10 million). Net foreign outflow was mainly seen in Hatton National Bank (Rs. 17 million). Foreign participation was 33 per cent.

On February 13, foreign investors were net buyers with a net foreign inflow of Rs. 333.33 million foreign participation was 61 per cent. Let’s hope this trend co continues.

 

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 slip from 4-wk closing high on profit-taking

FIRST CAPITAL’S HEAD OF RESEARCH, DIMANTHA MATHEW, SPEAKS TO REUTERS

Sri Lankan shares ended slightly weaker on Thursday, down from a four-week closing high hit in the previous session, as investors sold diversified and telecom shares after a three-day rising streak.

The Colombo stock index fell 0.03 percent to end at 6,173.72, sliding from its highest close since Jan. 18 hit on Wednesday as investors picked up the battered blue-chip shares.

“We saw a bit of profit-taking in the latter part of the day. But some crossings pushed turnover,” said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

Shares in Carson Cumberbatch Plc fell 8.14 percent, while conglomerate John Keells Holdings Plc lost 0.54 percent, dragging down the overall index.

Turnover stood at 633.1 million rupees ($4.20 million), in line with this year’s daily average of 631.5 million rupees.

Foreign investors net bought 67.5 million rupees worth of equities on Thursday. They have net sold 223.2 million rupees worth of shares so far this year.

“With interest rates on the rise, the market will remain slow in the next few days and many investors will wait to see the direction from the sovereign bond issue,” Mathew said.

The Sri Lankan cabinet approved a $1.5 billion sovereign bond issue to repay loans and manage interest payments, a cabinet spokesman said on Wednesday.

Yields on treasury bills rose 5-8 basis points at a weekly auction on Wednesday and are hovering at a more than four-year high.

($1 = 150.7500 Sri Lankan rupees)

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Biju Dwarakanath)

 

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 CEO panelist at 5th Annual Capital Market Conference

Mr. Dilshan Wirasekara, CEO First Capital Holdings PLC will be sharing his insights and expertise at the 5th Annual Capital Market Conference.

This year’s conference marks the 3rd consecutive year in which our CEO has been invited as a guest panelist representing the capital market industry in Sri Lanka.

The 5th Annual Capital Market (CAPM) Conference, organised by UTO EduConsult in conjunction with KPMG and Adl Capital as the Key Knowledge Partners, will be held for the fifth consecutive year on 21 February.

The event will witness senior personnel of the industry, including CEOs, Partners of Accounting and Legal firms, Investment Bankers, Realtors, Regulators et al participating in various panel discussions on the significant changes and developments taking place in the capital markets industry.    Read Full Article >

 

More Details on the Conference >

 

 

 

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 2-wk closing high as blue chips rally

FIRST CAPITAL’S HEAD OF RESEARCH, DIMANTHA MATHEW, SPEAKS TO REUTERS

Sri Lankan shares hit a two-week closing high on Tuesday as investors picked up blue chip shares such as John Keells Holdings Plc and Ceylon Tobacco Company Plc, brokers said.

The Colombo stock index ended 0.17 percent firmer at 6,148.94, its highest close since Jan. 23.

“Bargain hunting in blue chips is continuing. There was some block trades too,” said Dimantha Mathew, head of research at First Capital Equities (Pvt) Ltd.

Shares of John Keells Holdings Plc rose 1.01 percent, while Ceylon Tobacco Company Plc rose 0.59 percent.

Turnover stood at 548.9 million rupees ($3.65 million), more than this year’s daily average of 623.3 million rupees.

Foreign investors net bought 58.2 million rupees worth of equities on Tuesday. They have net sold 313.1 million rupees worth of shares so far this year.

On Thursday, Fitch Ratings affirmed Sri Lanka’s Long-Term Foreign- and Local Currency Issuer Default Ratings (IDR) at ‘B+’ and revised the outlook to ‘stable’ from ‘negative’.

Sri Lankan stocks have been hit by political uncertainty after ruling coalition parties decided to contest local polls separately, and on worries over a rise in interest rates.

Last week, the country’s central bank kept key rates steady for a sixth straight month, but flagged possible “corrective measures” in the months ahead in a sign further tightening might be on the cards to temper inflation pressures and safeguard a fragile rupee.

Yields on treasury bills are hovering at a more than four-year high.

Sri Lanka’s stock and foreign exchange markets were closed on Friday for a Buddhist religious holiday.

($1 = 150.3000 Sri Lankan rupees)

(Reporting by Ranga Sirilal and Shihar Aneez; Editing by Vyas Mohan)

 

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.

Monthly Economic Watch – Feb 2017

“Private sector credit growth registered at 21.9% on a YoY basis by end 2016. Credit disbursements in absolute terms remain high spite of the substantial upward adjustments in nominal and real interest rates.”

READ FULL REPORT 

  • Monetary Policy Review
  • Inflation
  • M2B & Sector Credit
  • Reserves & Liquidity
  • Currency Movement
  • Government Securities
  • Finance Sector Rate Movement
  • External Sector
  • Tourist Arrivals
  • Global Markets

“Policy rates were kept unchanged –

  • Standing Deposit Facility Rate – 7.0%
  • Standing Lending Facility Rate – 8.5%
  • Statutory Reserve Ratio (SRR) – 7.5% “

 

 

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.