October 30, 2018 (LBO) – Shares in Colombo Stock Exchange (CSE) bellwether John Keells Holdings (JKH) are soaring with the stock approaching Rs150/share after recently hitting multi-year lows.
The stock has had a strong near 20% bounce off the lows. Volume is light so far today even as the stock is up 4%.
Yesterday there was heavy buying by local investors and selling by foreign institutions. Net foreign outflow for the total stock market on the day was a heavy Rs3bn. There was speculation that the buying was done by some of Sri Lanka’s largest local investors who are significant holders of JKH already.
Some analysts say that if the government changes, the state institutions will again start deploying significant money into the stock market. This should push up JKH in addition to other companies. Local investors may be buying in front of this making the EPF and ETF have to eventually buy at even higher prices.
Sri Lanka is in the midst of a constitutional crisis where there are currently 2 government’s that claim legitimacy. The Sri Lanka Rupee is hitting record lows today near the rs175/dollar levels.