Business Times

Stockmarket Review

By Elton R. Ebert

Depression … Destruction … and Damage added to the reputation of the one time, high performing Colombo bourse this week.

Whether there will be a change to this situation, we may only know in the weeks ahead. But October 2011 has witnessed an unprecedented gloom, doom and depression. The daily turnover was the lowest for the year, and the prices were on a constant tumble causing a tremor in many areas especially to the retail segment who were trying to supplemment their income, the fund managers and of course the newly established broking firms.

Brokers complain of very few buying orders and most investors say it is safer to be a spectator. A retired Banker who was a victim of the forced-selling episode has kept off the market and says that he may enter the market if the regulators are changed with someone who has practical knowledge of the share market, pointing out that some of the rules may have to be modified. He stresses that it is hard earned money that he lost.

On one hand, research analysts were in an uncomfortable position trying to chart the direction of the indices. Some felt that the ASI at the 6300 mark should see some resistance, but it just went through this barrier without a whimper. Now their problem is where would be the next resistance level.

This situation was further aggravated with the last half of trading on Friday when a sudden buying frenzy pushed the two indices very much into positive territory, recovering much of this week’s lost ground. This was really an unbelievable situation, and no broker was able to produce a satisfactory answer.

While the market sentiment was depressing for most of the week, the 4.6 million shares in Infrastructure Development and the 24.5 million of Panasia Power were the light to the market. e-Channelling, Renuka Agri Foods, HVA Foods, and Free Lanka Caoital Holdings were in the active list. Shares which experienced a last moment upheaval on Friday were Asian Alliance at Rs 213, Regnis Lanka at Rs 482.60 and Bairaha Farms at Rs 212.90. The other interesting prices were that of Colombo Pharmacy at Rs.1375, J.L.Morisons Son & Jones at Rs.1999.50 and Nuwara Eliya Hotels at Rs 1500.

Changes in Directorates: First Capital Holdings- Lalith De Mel was appointed Director and Chairman; Hayleys Knitting Mills - S C Ganegoda relinquised his post of Deputy Chairman to assume executive responsibilities of two other sectors within the Hayleys Group. J A G Anandarajah was appointed Executive Director; Ceylon Brewery Holdings -Soren Hansen resigned as a Director and Gavin Brockett ceased to be his alternate Director. Graham James Fewkes was appointed Non Executive Director. Blue Diamonds Jewellery Worldwide - K S C P K Gunasinghe appointed to the Board of Directors along with U D Liyanagamage; Hunas Falls Hotels - Chandra J Wickramasinghe appointed Non- Executive Director.

The turnover for the week was a low Rs..4 billion as against Rs. 6 billion the previous week. Both indices were lower, the All Share Price lost 192.97 points or 0.3% to end at 6356.94 while the Milanka was 0.3% or 203.47 points lower at 5674.86

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