Sri Lankan stocks up 2.4-pct

Sri Lankan stocks extended gains Thursday closing up 2.4 percent with heavy trading on conglomerate John Keells Holdings (JKH) and financial sector companies activating the market, brokers said. The market has grown 59.9 perecent year to date, brokers said.
The benchmark Colombo All Share Price Index closed up 2.41 percent (56.54 points) to end at 2,399.46 while the Milanka index of liquid stocks gained 3.56 percent (93.20 points) to close at 2,711.28, according to provisional stock exchange data.
Turnover was 2.0 billion rupees.
"The market was driven with healthy participation from retail, corporate and high net worths investors," Thakshila Hulangamuwa of Asha Philip Securities, said.
"Overall inflow of foreign funds to the market signifies a bright future."
Brokers said 865 million rupees worth JKH shares traded at prices between 130.00 and 137.00 rupees. JKH closed at 137.25 rupees, up 9.00.
Commercial Bank of Ceylon closed at 135.50 rupees, up 6.50, while National Development Bank closed at 145.50 rupees, up 10.25.
Development Finance Corporation of Sri Lanka closed at 135.00 rupees, up 6.75. Sampath Bank closed at 114.00 rupees, up 1.00.
Investors traded 108 million rupees worth Aitken Spence shares. Aitken Spence closed at 630.00 rupees, up 30.00.
Distilleries Company of Sri Lanka, a unit of the Stassens Group controlled by business magnate Harry Jayawardena closed 81.50 rupees, up 50 cents.

"In the medium term the market would stay strong and would look at 2,500 levels on the ASI to stabilize and settle its cracks," Hulangamuwa, said.
Brokers said 3.36 million Sierra Cables share changed hands. Sierra Cables closed at 1.70 rupees, up 20 cents.
Index heavy, Sri Lanka Telecom closed at 47.25 rupees, up 2.50, while celco giant Dialog Telekom, a unit of Telekom Malaysia closed flat at 5.50 rupees.
Eagle Insurance closed at 139.50 rupees, up 7.50, while Ceylinco Housing and Real Estate Company closed at 16.75 rupees, up 3.75 on high volume trading.
Foreign investors were net buyers for 56.0 million rupees, buying 791.0 million worth shares and selling shares valued at 735.0 million rupees, brokers said.
The spot dollar remained unchanged at 114.90/95 rupees in late afternoon trade, dealers said.
More on www.lankabusinessonline.com

Satyam shares rise after profit

Shares in Satyam, the fraud-hit Indian IT firm, have risen for a third consecutive day after it released figures showing it remained in profit.

The stock jumped 10%, the maximum daily limit allowed, rising 7.35 rupees (15 cents) to 80.85 rupees ($1.70).

A local company Tech Mahindra bought a controlling stake in the IT company in April this year.

Satyam has struggled since its founder Ramalinga Raju said in January that its profits had been overstated for years.

He and eight others are facing charges of criminal conspiracy, cheating and forgery for allegedly stealing millions of dollars from the company.

Satyam announced robust earnings for the October-December quarter and a profit of more than 500 million rupees ($10.5m).

Federal corporate affairs minister Salman Khursheed said that the government-appointed directors nominated to run the company were now ready to move out.

"Our job is done. I think they can now be phased out. We can take credit for what we have done and will give credit to them for what they have done," he said on Wednesday

Satyam had been one of the biggest players in the booming Indian IT software market, supplying back-office services to firms from around the world, including General Electric and Qantas.

Stocks ready to build on gains

U.S. stocks were set to rise at Friday's open, as momentum from the previous session's rally held up and oil prices rose.

At 8:40 a.m. ET, Dow Jones industrial average, S&P 500 and Nasdaq 100 futures were higher.

Futures measure current index values against perceived future performance and offer an indication of how markets may open when trading begins in New York.

U.S. stocks climbed Thursday after a government debt auction elicited solid demand, tempering fears that borrowing costs would rise. The major gauges all added about 1%.

Len Blum, managing director for Westwood Capital LLC, said there is still a lot of "fundamental weakness" in the economy, without much of a tangible reason to rally aside from investor eagerness.

"I don't see a lot of reason for the economy to rebound in any kind of dramatic way," said Blum. "[But ] no one wants to miss the rally, so investors are looking for a reason to be optimistic."

Economy: Trading on Wall Street has been volatile recently amid uncertainty about the economic outlook.

Investors will focus on reports on gross domestic product, regional manufacturing and consumer sentiment.

The government said first-quarter gross domestic product fell at an annual rate of 5.7%. This is close to expectations of a 5.5% annual rate drop in the first quarter, according to a consensus forecast from Briefing.com. The initial reading last month put the annual rate of decline at 6.1%.

Companies: After U.S. markets closed Thursday, Dell (Dell, Fortune 500) reported a drop in sales and earnings. The company said a slowdown in PC sales pressured its bottom line.

Activist investor William Ackman's quest to overhaul the board of Target (TGT, Fortune 500) fell flat at the retailer's annual shareholder meeting. None of Ackman's candidates for the board won a seat.

World markets: Stocks around the world rose on the back of Wall Street's rally. In Japan, the Nikkei added nearly 1%. European markets were all higher in morning trading.

Oil and money: Crude prices kept on rising as traders bet that an economic recovery would lead to a pick up in demand. In morning trading, the price of oil rose $1.12 to $66.20 a barrel. The dollar fell against major international currencies, including the yen, the euro and the British pound.

How Stock Markets Work

If you'd like to buy a share of stock in any publicly traded company you'll most likely need the services of a brokerage firm. Though it's possible to buy and sell shares of stock on your own, there are some practical and legal problems with this approach. The securities industry is highly regulated, so you can't just hang a shingle and start selling stocks to the general public, unless you're properly registered and licensed.

When you want to buy groceries, you go to the grocery store. When you want to buy a sofa, you go the furniture store. And when you want to buy stocks, you need to do business with a brokerage firm.

A brokerage firm is a dealer of stocks and other securities that acts as your agent when you want to buy or sell stocks.

Most trading of stocks happens on a stock exchange. These are special markets where buyers and sellers are brought together to buy and sell stocks. The best known stock exchanges are the New York Stock Exchange and the American Stock Exchange.

Besides these two national exchanges, there are many smaller regional stock exchanges, such as the Pacific in Los Angeles, the Philadelphia, the Boston, the Cincinnati, and the Chicago. Some small companies are listed only on a regional exchange, while some NYSE and AMEX companies are listed on these smaller exchanges, as well, to help trades happen faster and cheaper for investors.

When most people think of a stock exchange, they picture a scene of frantic activity, with traders in funny-looking jackets simultaneously jostling for position, shouting commands, making strange hand signals, and writing up orders. Behind this frenzied spectacle, however, is a methodical and organized system of trading, in which the price of any stock is set purely by rule of supply and demand in an auction setting. Specialists help match buyers and sellers, but shares are always sold to the highest bidder.

From the perspective of an investor, buying and selling stocks seems pretty simple. If you use a full-service broker, just call her up on the phone and place an order for 100 shares of Coca-Cola. Within a few minutes, you'll receive a confirmation that your order has been completed, and you'll be the proud new owner of Coca-Cola's stock.

Behind the scenes, however, there's a lot of action that takes place between your order and the confirmation. Here's what has to happen:

1. You place the order with your broker to buy 100 shares of the Coca-Cola Company.
2. The broker sends the order to the firm's order department.
3. The order department sends the order to the firm's clerk who works on the floor of the exchange where shares of Coca-Cola are traded (the New York Stock Exchange).
4. The clerk gives the order to the firm's floor trader, who also works on the exchange floor.
5. The floor trader goes to the specialist's post for Coca-Cola and finds another floor trader who is willing to sell shares of Coca-Cola.
6. The traders agree on a price.
7. The order is executed.
8. The floor trader reports the trade to the clerk and the order department.
9. The order department confirms the order with the broker.
10. The broker confirms the trade with you.

That's how a traditional stock exchange works, but much of the action that takes place when you buy or sell a stock is being handled with the assistance of computers. Even if you bought a stock that trades on a stock exchange, your order may be executed with little or no intervention by humans. You can log on to a brokerage firm's Website, enter an order, have the trade be executed, and receive a confirmation all within sixty seconds or less.