In 2019 the market remained flat with indices in negative territory with the investors appearing to take a wait and see approach with it being an election year.
However following the presidential election we saw the sentiments changing and a shift in momentum with a rise in both market volumes and price indices which made November the best performing month for the year, Rajeeva Bandaranaike, CEO, Colombo Stock Exchange (CSE) said.
As a result the ASPI closed the year on a positive note of 1.27% year to date gain which is encouraging given that we ended on a negative 4.98% in 2018. Amid what was a challenging year for the stock market the local investor activity improved during the year with local investor contribution to turnover crossing a 60% mark (63.6%) for the first time since 2015.
Foreign investors were again net sellers in 2019, with Rs. 11.8 billion in net outflows which is an improvement over 2018 which recorded a net outflow of Rs. 23.2 billion.
The CSE is presently trading at a discount compared to most frontier and emerging markets at a market PE of 10.68 times and a Price to Book Value at 1.14 times. Whereas global equity markets remain expensive, CSE offers opportunities to generate attractive returns over the long-term, complemented by the growth potential of our listed companies.
“Going forward we believe that we will see improved market sentiments that will make the stock market more active and turn the indices into positive territory . We also believe that investors will be watching for the general elections and we may see the market momentum once the elections are completed.
“There are companies that offer good value and local and foreign Institutional investors will seek these opportunities.”
0 comments: