CSE closes marginally lower as construction activity strengthens

The Colombo Stock Exchange opened September on a marginally weaker note, with the All Share Price Index (ASPI) declining 0.10% to close at 21,318.31.

The more liquid S&P SL20 Index fell 0.39% to settle at 5,986.45, slipping below the psychologically important 6,000 level.

With Tuesday’s performance, the ASPI is now down 5.77% year to date, while the S&P SL20 has declined 2.78% so far this year.

Market breadth was slightly positive, with 102 counters recording gains against 97 decliners. The decline in the ASPI was mainly driven by John Keells Holdings, DFCC Bank and Dialog Axiata.

Daily turnover amounted to Rs. 2.32 Bn, improving from the previous session but remaining well below the daily average turnover of Rs. 3.99 Bn.

John Keells Holdings, Dialog Axiata and Ceylon Cold Stores led turnover during the session, while Capital Goods, Food and Beverages and Diversified Financials were the most active sectors.

Meanwhile, activity in the construction sector continued to expand at a healthy pace in July, according to the latest Purchasing Managers’ Index (PMI) data.

The construction PMI rose to 61.4 index points in July from 60.0 in June, indicating a continued expansion in construction activity.

The increase was supported by a sustained flow of construction work and a steady inflow of new projects. However, the sector continued to face input constraints, particularly a shortage of bitumen.

The continued expansion in construction activity could provide a positive backdrop for construction-related counters on the stock market, particularly if the flow of new projects remains steady.