Dropping inflation stimulates business sentiment elevation in bourse

By Hiran H.Senewiratne

The overall business sentiment at the CSE improved yesterday following the Department of Census and Statistics announcement that Sri Lanka’s national inflation rate has come down to 2.1 percent, which at one time moved up close to 70 percent last year, market analysts said.

Further, the market also got a boost when world leaders and international donor agencies expressed and confirmed support for the Sri Lankan economy to President Ranil Wickremeisghe, who is currently in New York attending the United Nations General Assembly annual sessions.

Further, market analysts said that they are seeing some renewed interest in the bourse possibly with the announcement of another bond auction today. There is expectation that rates will come down. That created a positive sentiment for yesterday’s market.

Amid those developments both indices moved upwards. The All- Share Price Index went up by 58.8 points while S and P SL20 index rose by 25.1 points. Turnover stood at Rs 1.1 billion with two crossings. Those crossings were reported in Melstacope, which crossed 2 million shares to the tune of Rs 172 million and its shares traded at Rs 86 and Windforce 4 million shares crossed for Rs 76 million; its shares traded at Rs 19.

In the retail market top five companies that mainly contributed to the turnover were; CIS Holdings Rs 88.3 million (1.1 million shares traded), JKH Rs 81 .9 million (431,000 shares traded), Distilleries Rs 59.6 million (2.2 million shares traded), Print Care Rs 36.8 million (695,000 shares traded) and Melstacope Rs 32.6 million (379,000 shares traded). During the day 33.1 million share volumes changed hands in 9000 transactions.

Yesterday the rupee opened stable at Rs 324/75 to the US dollar, same as at the close on Thursday, dealers said.Bond yields were up. A bond maturing on 01.08.2026 was stable at 14.75/15.25 percent. A bond maturing on 15.09.2027 was quoted up at 14.75/15.25 percent from 14.60/15.20 percent. A bond maturing on 01.05.2028 was quoted at 14.40/50.