Fears over state’s inability to secure IMF bailout by December hamper CSE

By Hiran H.Senewiratne

CSE trading activities were volatile yesterday due to rumours that the state is likely to miss the December 2022 deadline to secure an IMF loan. Instead, the belief is that the country will have to wait until March 2023 for the loan, stock market analysts said.Analysts said investors are concerned over the impact of local debt restructuring on risky assets as the market awaited a debt restructuring decision between the government and its creditors ahead of an IMF loan approval.

The market is generally moving on a wait-and-see approach as it expects the interest rates to adjust downward, brokers said. The market saw net foreign inflows of Rs 105.5 million. The total net foreign inflow so far for this year is Rs 18.5 billion.

Consequently, both indices indicated mixed reactions. The All-Share Price Index went down by 17.2 points and S and P SL20 moved up by10.3 points. Turnover was far more below the average level as it registered Rs 817 million without a crossing but this year’s average is around Rs 3.5 billion.

In the retail market top seven companies that mainly contributed to the turnover were; Expolanka Holdings Rs 157 million (942,000 shares traded), Lanka IOC Rs 150 million (822,000 shares traded), CIC Holdings Rs 58.1 million (644,000 shares traded), ACL Cables Rs 41.7 million (852,000 shares traded), Browns Investments Rs 29.3 million (4.3 million shares traded), CIC Holdings (non-voting) Rs 25.7 million (409.000 shares traded) and Kegalle Plantations Rs 20.2 million (129,000 shares traded). During the day 28 million share volumes changed hands in 12000 transactions.Yesterday the Central Bank-announced daily US dollar buying rate was Rs 360.88 and the selling rate Rs 371.68.