CSE registers record high market turnover in 2020

By Hiran H.Senewiratne 

The CSE  ended 2020 with a 10.5 percent  gain, the highest annual increase since 2014. Further, the   2020 gain was only the 12th occasion the index had seen a double-digit percentage growth in the CSE’s 35-year history, a top CSE official said.

In 2020 market turnover rose to the highest since 2011 and market capitalisation grew by rupees trillion  since May 2020, when the CSE resumed operations after the first COVID-19 wave and shutdown. The CSE ended 2020 with a market capitalisation of Rs. 2.96 trillion; up 3.8 percent  from a year earlier, CSE’s Head of Marketing Niroshan Wijesundara told The Island Financial Review.   

Wijesundera said that last year the market was quite active with the low interest rate regime. Consequently, 17,600 new investors in the age group 18 to 30 years joined as investors, which was quite encouraging for the market.

The market recorded a daily average turnover of Rs. 1.9 billion. This daily average turnover is the highest recorded for a year since 2011. The total turnover for the year was Rs. 397 billion which was also the highest since 2011. 

‘Last year the CSE performed even better than Singapore, which was one of the most active stock markets in the region. On the foreign investment front, 2020 has recorded a net foreign outflow of Rs. 51 billion, largely in line with the foreign fund outflow trend recorded in emerging and frontier markets, Wijesundera added.

Wijesundera added – ‘However, it is noteworthy that Sri Lankan equities attracted purchases worth Rs. 53 billion during 2020 by foreign investors, ending close to the Rs. 56 billion figure recorded in 2019. The stock market at present continues to indicate attractive valuations relative to other markets in the region.

‘The overall value of the stock market, which is represented by market capitalization, has also improved.”