Dominated by strong domestic participation the market witnessed one of its best performing weeks recording a healthy turnover of Rs. 2.5bn with daily turnover averaging a whopping Rs.510 mn, an all time high in the history of Colombo Stock Exchange. The ASPI almost reached the psychological barrier of 1,000 mark, thus falling short by 5 points to close the week at 995. The ASPI and the more sensitive MPI gained 6.5% (60.3 points) and 9.6% (167.2 points) with bulls continuing to completely dominate bears overwhelmingly, although some investors were skeptical about the political stability. It is also important to point out here that the market witnessed a technical correction during early hours, of trading on Wednesday but recovered the same day with indices moving back in to positive territory justifying the hidden strength of the market.

Banking and Finance sector continued to be the most dominant sector boosted by active buying on DFCC, NDB, NDB Bank, Sampath and NTB. The Food & Beverage sector too appreciated significantly with Distilleries, LMF and Three Acre Farms being the most actively traded stocks. We believe that there is also value in certain other sectors such as tourism, manufacturing, construction and engineering and plantation (rubber based companies) and would expect investors to have a close eye on respective shares.

Foreign buying centered around NDB Bank, NDB, Sampath, SLT, whilst foreign selling was seen on Sampath, JKH, Aitken Spence. A net foreign inflow of Rs. 72mn was recorded for the week.

The investor sentiment on the Colombo Stock Market has continued to remain high and we believe this trend to continue over the coming weeks. With the economy expected to record a higher growth in 2003 coupled with downward trend seen in interest rates and inflation would no doubt reflect in strong corporate earnings in financial year 2003/04.

All these above mentioned factors together with the extension of the tax amnesty by the government have made the Colombo Stock Market come to the limelight within a short period of time. Importantly, we believe the share investments by state institutions who have access to large funds still remain a tip of the iceberg. Next week will certainly a record breaking week with the high expectation of ASPI beating the 1000 point mark keeping the bulls busy all week around.