China’s lack of commitment to solution in credit restructuring process seen as hampering CSE

By Hiran H.Senewiratne

CSE trading was slow yesterday due to IMF comments on the Sri Lankan economy to the effect that key revenue targets, are yet to be fulfilled. Besides, the external credit restructuring process is yet to be concluded due to China not coming out with a solution, market analysts said.

Although the IMF negotiations are not all that negative in orientation, local and foreign investors are adopting a wait- and- see approach, market analysts said. It is said that the Paris Club, Non Paris Club and other external creditors have agreed to help Sri Lanka but China has not come out with a sustainable solution to Sri Lanka’s debt restructuring process, market analysts said.

Amid those developments both indices moved downwards. The All- Share Price Index went down by 183.43 points, while the S and P SL20 declined by 44.4 points. Turnover stood at Rs 686 million without any crossings.

In the retail market top seven companies that mainly contributed to the turnover were; JKH Rs 164 million (863,000 shares traded), Lanka IOC Rs 78 million (678,000 shares traded), HNB Rs 35.9 million (213,000 shares traded), Softlogic Capital Rs 20.3 million (1.8 million shares traded), Pan Asian Bank Rs 19.4 million (996,000 shares traded), Hayleys Fabrics Rs 19.2 million (406,000 shares traded) and Sampath Bank Rs 13.4 million (191,000 shares traded). During the day 23 million share volumes changed hands in 9600 transactions.

Yesterday the rupee opened at Rs 323.50/324.50 to the US dollar, from Wednesday’s close at 323.50/324.25, dealers said.

Bond yields were up. A bond maturing on 01.08.2026 was quoted up at 15.50/15.70 percent from Wednesday’s close at 15.50/65 percent. A bond maturing on 01.05.2028 was quoted at 14.50/14.80 percent up from 14.40/60 percent.