CSE plunge halts on Friday, forced sales over?

The Colombo Stock Exchange (CSE) which became one of the world’s best performers last year continuing its bull run into January 2022, Friday halted an equally sharp downward momentum, which gathered steam last week with both indices plunging sharply until Thursday,

But on Friday both the broader All Share Price Index (ASPI) and the S&P20 index covering blue chips and more liquid shares gained sharply by the close of trading with the ASPI up over 450 points (4.23%) and S&P gaining over 166 points (4.66%).

Brokers and analysts attributed this development to both international developments as well as the ending of compulsory forced share sales imposed on margin traders playing the market and broker credit.

“Much of the forced sales seemed to have finished and with that hopefully the uptrend will continue when trading resumes on Monday,” a broker said. “But international developments can be an influencing factor.”

Traders said that two counters, LOLC Holdings and EXPO Lanka, that had gained spectacularly in recent week saw their prices declining as sharply in the second half of February. This was a major reason for the indices being dragged down.