October a Glory Month for Colombo Stock Exchange

October was a glory month for the Colombo Stock Exchange (CSE) which performed spectacularly from the depths to which it had fallen over the last year.

The surge in turnover and share prices this month was largely attributed to retail sentiment on the possibility of the election of a more market friendly government on December 5.

"Although the take-off was right from the bottom, the gains were spectacular with Colombo widely regarded as the bet performing Asian market after the September 11 terrorist strike in the U.S.," an analysts said.

Many brokers did not discount the possibility of the All Share Price Index topping the 500 point market after the first two days of the bull run. They were proved right.

"There were some unbelievable bargains when the market bottomed," an investor said. "Those with strong nerves who bought then with confidence that there must be an upturn must be laughing all the way to the bank."

But analysts said that several strategic deals involving big players also happened in October due to the sharp increase in prices as a result of the upward market momentum.

Mr. Rajeeva Bandaranaike, Manager Marketing and Public Relations of the CSE said that figures indicate a massive surge in all the key indicators — turnover, daily average turnover, share volume, number of trades and thae two indices — the All Share Index and the Milanka Price Index.

Turnover up to October 26 had surged more than fourfold from September levels notching Rs. 2.3 billion from September’s Rs. 528 million. Daily average turnover was up nearly fivefold to Rs. 122 million from Rs. 26 million.

The All Share Price Index which topped the 500 mark for the first time since October last year closed on Friday at 501.5, up 24.25% from September’s 403.6. The Sensitive Milanka Price Index covering the more liquid blue chips did even better with a 230 point increase from 607.5 in September to 837.7 up to October 26 - a 37.9% leap.

Bandaranaike said that for the year from January to October 26 CSE turnover was Rs. 7.6 billion against Rs. 5.3 billion from January to September.

The October performance had also boosted the average daily share volume to Rs. 38 million for the period January to October 26 from Rs. 29 million from January to September.