Bourse in 2.3 per cent mid-morning plunge; panic selling hits market

By Hiran H.Senewiratne

CSE shares fell over 2.3 per cent in mid-morning trade yesterday, slipping for the fourth session, dragged down by heavy index counters. This has resulted in panic- selling of the market by investors, stock market analysts said.

According to brokers, margin investors are familiar with the “routine” margin call, where the broker asks for additional funds when the equity in the customer’s account declines below certain required levels. Normally, the broker will allow from two to five days to meet the call. ‘Therefore, the dip in imports continued in September, but has yet to decline to the lowest in recent years despite stepped up controls that worry market investors, apart from delays in IMF discussions, stock market analysts said.

September 2022 saw $ 1.28 billion in imports, down from $ 1.48 billion the previous month and 16 per cent year- on- year. However, the June 2022 figure at $ 1.22 billion remains the lowest so far this year, suggesting there is room for further decline given the foreign exchange crisis. The lowest import figure was in May 2020 at $ 994 million as an immediate impact of the COVID-19 pandemic, market analysts said.

Amid those developments both indices moved downwards. The All-Share Price Index went down by 227.6 points and S and P SL20 declined by 68.1 points. Turnover stood at Rs 1.1 billion with a single crossing. The crossing was reported in Renuka Holdings, which crossed 2.7 million shares to the tune of Rs 43 million, its shares traded at Rs 16.

In the retail market top seven companies that mainly contributed to the turnover were; Expolanka Holdings Rs 235 million (1.5 million shares traded), Lanka IOC Rs 133 million (776,000 shares traded), JKH Rs 72 million (545,000 shares traded), ACL Cables Rs 63.5 million (875,000 shares traded), Kegalle Plantations Rs 30 million (201,000 shares traded), Agsta Rs 29.5 million (1.6 million shares traded) and Expack Corrugated Cartons Rs 28.5 million (1.8 million shares traded). During the day 46.5 million share volumes changed hands in 18000 share transactions.

Yesterday the Central Bank- announced US dollar buying rate was Rs 360.88 and the selling rate Rs 371.68.