The Bourse Weekly Performance (Week Ended 26th March 2021)

Week-ended 26th March 2021 Week-ended 19th March 2021

All Share Price Index 7,097.39 6,854.32 S&P SL20 Index 2866.66 2757.45 Total Turnover for the week (LKR) 6,393,947,509 5,568,865,467 Total Net Foreign Inflow/ (Outflow) (LKR) (554,638,156) (562,200,890) Market Capitalization 3,100,454,844,919 2,994,355,317,734 Market PER 13.99 12.82 Market PBV 1.13 1.09

The Colombo Bourse closed on a positive note with the ASPI gaining 3.5% WoW to close at 7,097 index points and S&P SL 20 gaining 4% WoW to close at 2,867 index points. The week’s turnover recovered to LKR 6.4 bn as opposed to last week’s LKR. 5.6 bn. Crossings were witnessed in , CIC, Dipped Products, HNB Assurance, , HNB, LOLC Holdings, Overseas Realty, Royal Ceramic, and Tokyo Cement which collectively accounted for 18% of the total turnover. Browns Investments, LOLC Holdings, , Ceylon Tobacco and Sampath Bank recorded as some of the top gainers. Meanwhile, foreigners continued to close the week as net sellers with a net capital outflow of LKR 555 mn.

The market rebounded last week with higher investor participation, mainly stemming off domestic participation. We continue to expect the market to trade range bound on the back of moderate volumes due to a lacking impetus. Accordingly, we recommend investors to adopt an active investment strategy taking advantage of any price weakness and focusing on fundamentally robust stocks with strong EPS growth prospects in the long run.

Exchange Rates (Week ended 26th March 2021)

In Forex markets, the USD/LKR rate on the more active 01 week forward contracts were seen closing the week at Rs.199.25/199.75 in comparison to its previous weeks closing level of Rs.198.00/199.00. The daily USD/LKR average traded volume for the first four days of the week stood at US $ 82.40 million.

The Government securities Market (Week ended 26th March 2021)

The trading activity in the secondary bond market remained rather moderate during the week ending 26th March 2021 as most market participants persisted to be on the side lines ahead of scheduled Treasury bond auctions for tomorrow, 29th March.

The auction will have on offer a total amount of Rs.60 billion, consisting of Rs.25 billion of 15.11.2023, Rs.20 billion of 15.01.2026 and Rs.15 billion of 01.05.2028. The maximum yields rate for acceptance for the said maturities was published at 6.30%, 7.05% and 7.60% respectively. The weighted average yields at the bond auctions conducted on 10th March 2021 were 6.19%, 7.08% and 7.44% for the maturities of 01.09.2023, 01.02.2026 and 15.08.2027 respectively.

Meanwhile, the weekly T-bill auction went undersubscribed for a third consecutive week as only an amount of Rs.11.55 billion was accepted in total against its total offered amount of Rs.45 billion.

In secondary bond markets, the limited activity during the week centered on the maturities of 2022’s (i.e. 01.10.22, 15.11.22 & 15.12.22), 15.01.23, other 2023’s (i.e. 15.05.23, 15.07.23 & 01.09.23), 01.01.24, mid 2024’s (i.e. 15.06.24 & 15.09.24) and 01.12.24 within the range of 5.80% to 5.88%, 5.93% to 5.95%, 6.15% to 6.22, 6.40% to 6.42%, 6.55% to 6.60% and 6.60% to 6.68% respectively while in the secondary bill market, May and June 2021 maturities and September 2021 maturities traded at levels of 4.80% to 5.04% and 4.95% to 5.09% respectively.

In money markets, the total outstanding market liquidity was seen decreasing further during the week to a low of Rs.100.67 billion against its previous weeks closing of Rs.119.18 billion, before increasing once again to close the week at Rs.127.70 billion. The weighted average rates on overnight call money and repo remained mostly unchanged to average 4.58% and 4.60% respectively for the week while the CBSL’s holding of Gov. Security’s increased further to Rs.842.25 billion.

(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)

Courtesy – Asset Trust Management (Pvt) Ltd, WealthTrust Securities Ltd