Investor worries over banking sector hamper share market

By Hiran H.Senewiratne

CSE trading activities were low yesterday and investors were worried that the banking sector would be included in the debt restructuring process of the government. If the government assured the banking sector would be excluded from debt restructuring, the market would bounce back, market analysts observed.

“There is nothing happening in the market; investors are clearly on a wait- and- see approach and are selling out because of interest rates becoming unbearable. Margin rates are 36 per cent and investors don’t want to keep shares for the long run because of the rate of interest, an analyst said.

Amid those developments both indices moved downwards. The main All- Share Price Index was down by 63.25 points, while the most liquid index S&P SL20 was down by 24.46 points. Turnover stood at Rs 524.4 million without any crossings.

In the retail market top seven companies that mainly contributed to the turnover were; Browns Investments Rs 71.5 million (14.2 million shares traded), HNB Rs 42.6 million (357,000 shares traded), Hemas Rs 35.5 million (559,000 shares traded), Melstacorp Rs 27.2 million (510,000 shares traded), Union Bank Rs 22.6 million (2.7 million shares traded), Expolanka Holdings Rs 22.5 million (159,000 shares traded) and Hayley’s Rs 17.1 million (252,000 shares traded). During the day 48.5 million share volumes changed hands in 9477 transactions.

Yesterday bond yields were steady at open and the rupee opened at Rs 307.20/308.00 against the US dollar in the spot market, dealers said. A bond maturing on 01.09.2027 was quoted at 26.30/27.00 per cent, unchanged from Wednesday’s close.

The rupee opened at Rs 307.20/308.00 against the US dollar in the spot market, weaker from yesterday’s close at Rs 305.80/306.20.