Business
Macroeconomic considerations have investors worried
By Hiran H.Senewiratne
CSE investor sentiment was dull yesterday because investors were somewhat worried about Sri Lanka’s macroeconomic factors. Consequently, the market at the beginning reflected a dull performance but at midday showed some recovery. However, at the end of sessions the market turned negative, stock market analysts said.
Stock market investor participation was low because investors are adopting a wait and see approach until the release of the monetary policy review of the Central Bank on October 14. The prices of several essential items have skyrocketed and consumers fret over the soaring cost of living, while the pandemic and poor foreign reserves situation too discourage investors from investing in the stock market. These developments have put listed companies also under pressure, stock market analysts added.
Consequently, both indices showed mixed reactions. The All-Share Price Index went down by 8.9 points and S and P SL20 rose by 4.7 points. Turnover stood at Rs two billion with a single crossing. The crossing was reported in HNB, which crossed 450,000 shares to the tune of Rs 66 million, its shares traded at Rs 149.
In the retail market, five companies that mainly contributed to the turnover were; Expolanka Holdings Rs 299 million (1.5 million shares traded), Browns Investments Rs 196 million (18.4 million shares traded), Agstar Rs 120 million (9.9 million shares traded), Royal Ceramic Rs.75 million (1.5 million shares traded) and Colombo Fort Land Rs 73.5 million (4.3 million shares traded). During the day 98 million share volumes changed hands in 23000 transactions.
Yesterday the Sri Lankan rupee was quoted against the US dollar at Rs 200.25. This was a controlled price, which is not the actual market value. The reason to control the price at the Rs 202 level is to prevent prices of goods from skyrocketing in the country.
It is said that foreign investors were net sellers in the equity market, offloading shares worth Rs 149 million, as per exchange data. Sri Lanka government bonds suffered their biggest drop in nearly seven weeks after the Central Bank scrapped a plan to buy back a chunk of the country’s debt on the cheap after default fears pounded prices, market sources said.