Sri Lanka Stock Index Loses Gains on Economic Concerns; turnover at its lowest for 4 months

ECONOMYNEXT – Sri Lanka’s stock index gave up early gains to close slightly higher on Monday (14) as looming economic uncertainties weighed on sentiment, brokers said, as data showed the figure for The day’s business had hit its lowest level in four months.

The main All Share Price Index (ASPI), which jumped 100 points or nearly 1% to its highest level since February 8, closed down 0.09% or 11.01 points at 12,470.81 points.

Turnover for the day was 2.25 billion rupees, its lowest since October 12, and less than a third of this year’s daily average of 7.2 billion rupees.

“There was a lot of volatility in the market. We saw selling pressure return today as the downtrend emerged. Although the market was down during the day, it rallied before the close,” said a leading market analyst, adding that investors are seeing the opposite of positive sentiment.

“The market is trying to rise, but there is a lot of uncertainty in the market and the economy is affecting its gain.”

Last week the market lost 2.3%.

The market trended lower despite many companies posting better-than-expected earnings in the December quarter.

Investors have questioned the sustainability of earnings with the ongoing forex crisis that most companies are going through, analysts said.

S&P SL20 of the most liquid index rose 0.33% or 14.13 points to 4,233.55.

Foreign investors, very worried about a possible sharp depreciation or devaluation of the currency, on Monday sold shares with a net worth of 41.8 million rupees.

Overseas sales so far this year have been Rs 3.39 billion. In 2021, the Sri Lankan stock market suffered a net foreign outflow of Rs 50 billion.

Analysts had predicted that economic concerns would drag the market from time to time until the government finds a lasting solution to the country’s looming debt crisis.

Aitken Spence, Sampath Bank and Dialog Axiata helped end the index up slightly after stocks posted positive earnings for the December quarter.

Aitken Spence rose 7.2% to close at 101.50 rupees per share, Sampath Bank gained 2.1% to close at 53.80 rupees per share while Dialog Axiata gained 7.3% to close at 11 .70 rupees per share.

Expolanka, the market heavyweight which has export and freight business, bucking the trend, fell 0.45% to close at 332.50 rupees to offset the gains. (Colombo/February 14, 2022)

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