Cooling off period did not stop free fall
Trading on CSE suspended for 30minutes as Milanka plunges

The Colombo bourse plunged yesterday losing much of the previous two days gains and triggerered for the first time the CSE’s new "circuit breaker" mechanism providing for a 30-minute cooling off period when the markets declined sharply.

Trading was suspended for half an hour from 11.33 am to 12.03 pm after the Milanka shed 5% during the day’s trading up to then.

Trading resumed half an hour later but the fall continued with the Milanka down 138.51 points (6.89%) while the All Share lost 90.14 points (4.98%) on a turnover of Rs.202.2 million, down from the previous day’s Rs.245.1 million, when the market closed.

"All the blue chips took a tumble," Prashan Fernando of Acuity Stockbrokers said. "There was across the board selling as well as profit taking."

Among the stocks that lost ground was JKH which declined Rs.3.75 on a trading range of Rs.67.50 to Rs.72.75 to close at Rs.69 generating the day’s highest turnover of Rs.55.6 million.

This counter had declined to Rs. 50 earlier this month and bargain hunters who picked it low were happy to take profit, brokers said.

While there was a lot of retail activity on JKH, two big parcels of 162,100 were done at a Rs.70 price during the early afternoon trading when the market resumed after the `cooling off.’

Dialog which lost 75 cents to close at Rs.5 on nearly 2 million shares and SLT which declined Rs.1.50 to close at Rs.35.75 on 67,100 shares, were among the big marketcap stocks that dragged down the indices yesterday brokers said. Distilleries too was down though on thin volumes.

Ceylon Tobacco closed flat at Rs.73 trading between Rs.73 and Rs.73.50 with nearly 0.2 million shares done contributing Rs.12.8 million to turnover.

Among the losers showing volume were Touchwood, down Rs.6 to close at Rs.58.75 on 154,000 shares done between Rs.58 and Rs.69.50, Commercial Bank, down Rs.5 to close at Rs.87.25 on a trading range of Rs.86 to Rs.92 on 76,700 shares and non-voting shares of Seylan, down 50 cents to close at Rs.6.25 on 1.8 million shares done between Rs.6.25 and Rs.6.50.

HNB was another blue chip that dipped Rs.6.75 to close at Rs.85 with 68,200 shares trading between Rs.85 and Rs.93 while Maskeliya, which attracted heavy play on Tuesday, dipped 75 cents to close at Rs.16.75 on over 0.2 million shares traded between Rs.16.75 and Rs.19.

Lanka Cement which has been attracting trading interest dropped 50 cents to close at Rs.9.75 on over 0.3 million shares done between Rs.9.50 and Rs.10.25.

Keells Food Products announced a seven for 10 rights issue priced at Rs.50 subject to CSE and shareholder approval.

The company announced in a Stock Exchange filing that the Rs.1,750 million cash infusion will be utilized to fund expansion plans into India through a 100% subsidiary, John Keells Foods India (Pvt) Ltd.

The Keells Food board had resolved that in its opinion the Rs.50 price per share "is fair and reasonable to the company and to all existing shareholders."

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