Colombo stocks drip lower through the week, foreign selling continues

June 29, 2018 (LBO) – The Colombo Stock Exchange (CSE) continued its slow bleed as stocks closed the week down from the previous period. Both major indices were down on the week. The All Share Price Index (ASPI) was down .5%, and the S&P SL 20 was off 1.1%.

The trend of marginal foreign selling continued with net sales for the week of Rs392mn (US$2.45mn).

Turnover for the shortened 4 day trading week was Rs750mn (US$4.7mn) per day, up moderately from Rs600mn (US$3.75mn) the previous week.

Analysts have been quick to point out that the slow bleed on the CSE is in contrast to the material weakness being seen in other emerging markets.  However, with continuous weak trading volume, the bourse has become very illiquid.

From a valuation perspective, Colombo Stocks appear cheap with a market PE ratio of around 10.5 and a market price to book ratio of around 1.25.

Year to date the ASPI is down 2.74% and the S&P SL 20 is down 7.7%.